Wednesday, September 16, 2009

Facebook reports profitability

The world's largest social network announced yesterday that it has become "cash flow positive," ahead of its expected profitability schedule "sometime in 2010."

This is news because Facebook hasn't truly cracked the code on developing an advertising model for its business. The site currently has low-cost, low-quality display advertising, and some other revenue models, but nothing outstanding.

According to CEO (and co-founder) Mark Zuckerberg, Facebook has turned a profit because it has kept headcount low. The site reportedly uses one engineer for every million users--of which there are 300 million worldwide. And, growth is happening at an astounding rate as parents, and even some grandparents, of the initial core Facebook audience are adopting the social networking phenomenon.

It's nice to finally see a web 2.0 start-up make money.

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