Social media giant Facebook Inc’s Indian arm posted a 52 per cent jump in its revenues at ₹521 crore in the year ending March 2018 compared to ₹341.8 crore in the previous year. Last year, Facebook’s revenues in India had doubled indicating a slower growth in 2017-18.
In the fiscal 2018, Facebook India Online Services Pvt. Ltd, which also owns popular messaging app WhatsApp and content platform Instagram, reported a net profit of ₹57 crore, which is a 40 per cent jump from ₹40.7 crore in fiscal 2017, according to the company’s annual filings with the Registrar of Companies that was accessed from business intelligence platform Tofler.
In 2017-18, the company’s revenue and profits both witnessed a slower growth even globally after the Mark Zuckerberg-led social networking platform was hit by a massive data breach allegation in March 2018. The company’s total expenses for the fiscal almost doubled at ₹444 crore compared to the previous year at ₹285.5 crore. The company’s expenses have been doubling for the last two years, which could be a reason why the profits have come down.
According to experts, FY18 was not a good year for the media and advertising sector as the segment was hugely impacted by lower ad spends due to Goods and Services Tax (GST) rollout and demonetisation. The industry saw a drop of 20–25 per cent ad revenue during the year.
However, experts believe and expect the ad spends to improve in FY19 for all the social media companies. Facebook is also competing aggressively to take on search engine behemoth Google’s digital ad revenue in India. Google’s total revenues in India has already touched ₹10,000 crore in FY18.
Currently, Facebook and Google together claim 68 per cent of India’s digital ad market, according to a report and it is likely to grow as the digital advertising spending is expected to also increase by 30 per cent in 2019.