Facebook (FB) stock has made a big comeback after its May IPO saw the company's value drop almost by half.
Facebook shares bounced on Thursday by nearly 20% after the social network reported stronger than expected third quarter earnings, which highlight was the social network's ability to capitalize on its mobile growth.
Facebook’s revenue rose 32% to $1.26 billion, topping the average of estimate of $1.23 billion, thanks to the company's earnings of 12 cents per share (as opposed to a previously estimated 11 cents per share).
Facebook had alarmed investors in the previous quarter with his inability to monetize its mobile apps. However, the company's mobile ad revenue went from $10 million in the second quarter to $150 million in the third quarter (14% of the company’s total advertising revenue).
The increases are due to the social network's over half a dozen new paid advertising initiatives designed to attract more businesses looking to reach a broader audience on smartphones and tablets (i.e. "Sponsored Stories" and "Promoted Posts").
Though desktop and laptop-based advertising still generate the majority of Facebook’s revenue, there is room for further mobile growth since — as stated by Facebook CEO Mark Zuckerberg "60% of Facebook’s user base of 1 billion members are currently accessing the website from mobile devices, up from 47% in the prior year quarter."