Facebook has warned growth in advertising revenues will slow “meaningfully” in the next few months as it tries to avoid alienating users.
According to BBC, the social media giant’s chief financial officer David Wehner said there was a limit on the number of ads it could put on people’s timelines. Shares fell 7% in after-hours trading.
According to BBC, the comments came as Facebook reported profits of $2.4bn (£1.9bn) between July and September, up 166% from the same period in 2015.
Most of Facebook’s revenues came from adverts, of which mobile accounted for 84%.
Facebook founder Mark Zuckerberg described the results as “another good quarter”. Nearly 1.1 billion people now log onto Facebook on their mobiles every day, compared with 894 million a year ago.
Even though they have experience all these wonderful and glorious days, they are going to add fewer ads, which will make ad revenues reduce “meaningfully” in 2017.
According to some experts, this will force Facebook to go into other means of making money.
Josh Olson, an analyst at Edward Jones, said the group could still make more money from charging advertisers higher prices and through adding new customers.
“We have been down this road before with Facebook, they have invested something like this in mobile and we have seen it pay off. So we are looking at it as an opportunity,” he said.