Facebook profit nears $700M as user base grows along with ad views

Facebook Inc. on Wednesday reported fourth-quarter profit of $696 million as the social media company signed up more members who logged on to the site more often, and viewed more ads.

On a per-share basis, the Menlo Park, California-based company said it had profit of 25 cents. Earnings, adjusted for stock option expense and amortization costs, were 54 cents per share.

The results topped Wall Street expectations. The average estimate of analysts surveyed by Zacks Investment Research was for earnings of 49 cents per share.

The stronger finances were driven by a growing user base that's using the service more and more. Facebook says it had 890 million daily users every day, on average, in December, an increase of 18 per cent year-on-year. On Mobile, the growth was even stronger, up 34 per cent on the year to 745 million during the month.

And almost two thirds — 64 per cent — of the social network's almost 1.4 billion users come back to the site at least once a day.

And all those eyeballs are translating into more ad dollars for the company.

The social media company posted revenue of $3.85 billion in the period, also surpassing Street forecasts. Analysts expected $3.79 billion, according to Zacks. The ad figure is up 54 per cent compared to last year.

Facebook shares have declined nearly 2 per cent since the beginning of the year, while the Standard & Poor's 500 index has decreased nearly 3 per cent. In the final minutes of trading on Wednesday, shares hit $76.65, an increase of 39 per cent in the last 12 months.