Reuters reports, however, that ‘people familiar with the situation’ (don’tcha love that kind of description of sources?) are saying that at least in 2009 Facebook was profitable.
Facebook’s financial performance is stronger than previously believed, as the Internet social network’s explosive growth in users and advertisers boosted 2009 revenue to as much as $800 million, according to two sources familiar with the situation.
The company also earned a solid net profit, in the tens of millions of dollars last year, one of the sources said.
That growth in profit and revenue underscores how Facebook is increasingly making money off its 6-year-old service, which ranks as the world’s largest Web social network with nearly half a billion users.
The question around Facebook and people like us who are trying to get a grasp of just how ‘real’ they are as a company have always asked “How will Facebook make money?”. Maybe the better question to ask is “How MUCH money will Facebook make?”.
It has always been our understanding that Facebook is just learning how to make money and the assumption seems to always be that they are making some but not enough. Maybe that’s not the case at all.
It is possible that all of this could be simply part of the way that Facebook continues to build interest in what would be one of the most anticipated IPO’s in a very long time. It’s an interesting game to say the least.
“They are downplaying their performance,” one source said, adding that 2009 revenue was more than double the previous year’s total. “There’s no upside in getting people’s expectations high, it’s always better to go low.”
If Facebook eventually seeks to go public, unveiling financial figures above expectations could help bolster investor interest.
Facebook declined to comment.
There has been no official announcement from the company this needs to be taken for what it is: unofficial. Of course, considering how Facebook views privacy maybe they should be a little more open around these things ;-).