Facebook beat projections with its Q2 2016 earnings, announced today, taking in $6.44 billion in revenue — an increase of $2.44 billion (59%), year-over-year. It also reached new heights with 1.71 billion actively monthly users, up from 1.49 billion in the same period last year, and ad sales exceeding $6.2 billion.
But, in a statement accompanying the earnings report, Facebook founder and CEO Mark Zuckerberg said that he was “particularly pleased with [Facebook’s] progress in video as we move towards a world where video is at the heart of all our services.”
In a subsequent call with analysts, Facebook COO Sheryl Sandberg noted that people are sharing and creating nearly three times more video on the platform than they were a year ago and, as of February, the time people spend watching videos on Instagram had by more than 40 percent over the preceding 6 months.
“This presents a big opportunity for marketers,” said Sandberg during the call. “The best marketers understand that people watch video differently in mobile feed than on TV. They create ads that grab attention in the first few seconds, sometimes even without sound — what we now call thumb-stopping creative.”
Sanderberg pointed to how Nestle took their TV ad for Natural Bliss Coffee Creamer and edited it for mobile feed by creating a new opening and adding text overlays to communicate their message without sound. When both the original TV ad and the mobile ads were shown on Facebook, the original TV spot had a 4-point increase in ad recall, while the mobile-optimized version showed 10-point increase in ad recall and a 7-point increase in product awareness, she said.
During his portion of the call, Zuckerberg told analysts, “we’re at the beginning of a golden age of online video.”
“Video isn’t just a single kind of content,” he said. “We think its medium that allows people to interact in a lot of new ways… I’m a big Game of Thrones fan, and the other week HBO and our Oculus team came out with a 360 video of the opening sequence of the show. It’s now the most watched 360 video on Facebook in any 24-hour period with more than 12 million total views.
Zuckerberg also touted the potential of Facebook Live, which completed its rollout to users last month.
“Friends go Live because it’s unfiltered and personal. Actors and news anchors go Live because they can reach bigger audiences and in some cases than they can even on their own shows,” Zuckerberg said. “And if we do a good job, we think it’s something that people will associate with Facebook — with interacting with people and not just watching content. But it’s also a very new and a small part of all the videos we see on Facebook today.”
Zuckerberg was less bullish about Oculus Rift, the virtual reality headset the company started shipping in early 2016.
“This is very early, and we don’t expect VR to take off as a mainstream success right away. I really want to emphasize that,” he said. “Most Rift early adopters are gamers and developers, but eventually we believe that VR is going to be the next big computing platform, and we’re making the investments necessary to lead the way there.”