3 Comments

Summary:

Looking to fend off rampant speculation that it needed to raise additional cash, Facebook said in March that it expected to be cash-flow pos…

Mark Zuckerberg
photo: AP Images

Looking to fend off rampant speculation that it needed to raise additional cash, Facebook said in March that it expected to be cash-flow positive by 2010. Facebook CEO Mark Zuckerberg now says the company has actually been cash-flow positive for the last quarter. No word on how much cash Facebook is throwing off, but it’s still a significant milestone considering that Facebook had been widely criticized for emphasizing (costly) user growth over revenue.

As for user growth, it only seems to be accelerating. The social network says it now has 300 million active users, double the number it heralded at the start of the year and 50 million more than it had just two months ago.

One missing stat is how much revenue is increasing. Facebook also said in March that it expected sales to jump 70 percent this year, but Zuckerberg does not provide an update to that forecast. The social network has steadily been adding new ways for advertisers to target its members, including adding more sophisticated targeting tools and also testing out direct response ads.

You’re subscribed! If you like, you can update your settings

  1. DON'T BELIEVE THE HYPE. When was the last time you clicked on a Facebook ad and made a purchase? This is a Bernie Madoff type setup. The people at Facebook are trying to hype an IPO so they can cash out and leave the suckers with worthless paper. A privately held company can say anything about profits and cash flow and not have to prove it. When the advertisers realize Facebook is 300 million people doing a WHOLE lot of nothing,it's going to collapse. The question is whether the collapse comes before or after the IPO. NO ONE is going to pay a dime for a Facebook page. NO ONE is buying anything. So where's the profit coming from? Facebook is depending on advertising dollars just like the newspapers are. We all know where newspapers are heading. Facebook's profit model is no different. They're not going to replace Paypal, that's a big joke! So if income is solely based upon advertising, the job isn't getting done! When the Russian money runs out, Facebook is toast. I ask you again, when was the last time you bought something from an ad on Facebook? I rest my case.

  2. Nurredin,

    Just because you didn't click on a Facebook ad does not mean others did not. To compare Facebook model to newspaper direction is outrageous at best.

    Facebook advertising sits on top of a social infrastructure, one of the most powerful base available for marketers. Their content is more segmented, more intimate and measurable than any other medium out there for advertising/marketing. Please disagree if you can, I'll like to see the attempt.

    Facebook profit model is more scalable than a search engine, if not obsolete the search engine model altogether for primary information retrieval and first destination…

Comments have been disabled for this post