Facebook appears to be losing its youth appeal, with the company admitting for the first time a slight decline in teen usage on the social network.
From Q2 to Q3, "we did see a decrease in daily users, specifically among younger teens [in the U.S.],” Facebook CFO David Ebersman told analysts during an earnings call in which the company also announced a record $2 billion in quarterly revenue.
Ebersman pointed out that Facebook doesn’t normally offer such granular details. But the company has continued to field questions about younger consumers embracing rival platforms like Twitter and Snapchat. Another digital brand they're flocking to is Instagram, the photo-sharing app that Facebook acquired last year and that boasts 150 million monthly users. By comparison, Facebook counts 144 million daily users in the U.S. and Canada, and 1.2 billion active monthly users worldwide.
The company said the dip in teen usage was not statistically significant and did not carry over to monthly usage.
While noting Facebook's rivals and the changing media habits of teens, industry watchers point out that young people haven't given up on the world's biggest social net altogether. “Many teens see Facebook as a utility like email—it’s a service you have to check, but it’s not the hot 'it' platform for those demographics, which was something Facebook used to be,” said Clark Fredricksen of eMarketer.
News of Facebook's teen slump seemed to take the momentum out of its after-hours earnings rally. Shares in after-hours trading had been up by as much as 15 percent before swinging back to where they ended the regular trading day, at around $49.
Here are the key numbers from Facebook's third quarter:
-Mobile revenue now accounts for an astounding 49 percent of ad dollars, up from 41 percent the prior quarter. Not long ago, Facebook did not sell mobile advertising.
-Third quarter mobile advertising revenue came in at about $900 million.
-Overall ad revenue—on desktop and mobile—was up 66 percent from the same time last year to $1.8 billion.
-Revenue, including payments, hit $2.016 billion, a 60 percent increase from the same period in 2012.
-Third quarter profits hit $425 million, compared to a $59 million loss last year at this time.
-Daily active users were up 25 percent to 728 million last quarter.
-Monthly users hit 1.2 billion, an 18 percent jump year over year.
-There were 874 million mobile monthly users, a 45 percent year-over-year rise.