Facebook reports strong profits in fourth quarter

The social network said it ended 2014 with 1.39 billion monthly users

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The Independent Online

Facebook has reported strong profits for its fourth quarter as it saw a surge in takings from mobile advertising.

The social network said it earned $701 million (£462.9 million) in the final three months of the year, a 34 per cent increase on last year, as revenue jumped by almost half to $3.6 billion.

It revenue from its European business surpassed $1 billion for the first time ever.

Advertising revenue per user rose 31 per cent globally to $2.81.

With mobile advertising, Facebook has managed to turn what was once a weak spot into a major source of growth, leaving behind other internet giants like Yahoo that have struggled to keep up with advertisers shifting to smartphones and tablets over PCs.

Facebook said it ended 2014 with 1.39 billion monthly users, 86 per cent of whom access its services on smartphones and other mobile devices.

Its profit growth was limited, however, by a massive increase in spending. Expenses were up 87 per cent at $2.7 billion in the fourth quarter

Facebook had previously flagged that this year would see heavy investment as it taps opportunities in its platforms like Instagram and Whatsapp.

Analysts have said that those services could be a significant source of long-term growth for the company.

Investors are also betting that a ramp up in video advertising will contribute Facebook's next leg of growth.

Additional reporting by Reuters

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