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Facebook’s Domestic User Growth Continues to Slow

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85% of users are from international market

Social media is at the forefront of digital advertising due to high engagement and increasing user activities. Facebook (FB) showed a rise of 15% in its number of monthly active users (or MAU), which stood at 1.6 billion in 3Q15 compared to 1.4 billion in 3Q14. Twitter’s (TWTR) MAU stood at 320 million.

The above chart represents the growth of display advertising for Facebook and Twitter as online users spend more time on social media websites compared to Yahoo (YHOO) and Google (GOOG).

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Facebook is generating its revenue from different sources, but its primary source of revenue is flowing from advertising. The majority of its revenue comes from outside North America, and around 85% of its users are from international markets, as user growth from the United States and Canada has continued to slow.

The Asia-Pacific (or APAC) region has 2.5 times more users than North America. Despite this large number of users, APAC generates less than 33% of Facebook’s domestic revenues.

Emerging markets such as India (EPI), Brazil (EWZ), and some parts of Africa have high user growth rates compared to the United States and Europe. Facebook made an addition of 72 million users from APAC compared to only 23 million users from the United States, Canada, and Europe combined in the first three quarters of 2015.

For this reason, Facebook launched a project in 2013 to bring affordable Internet access to everyone around the world. Facebook has made its Free Basics project available in 31 countries, including emerging markets such as Africa, Southeast Asia, and Latin America.

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