A Political factor that has positively affected Facebook is that developing countries are growing financially this allows people to be able to buy a computer or a smartphone which allows more people to have access to Facebook. Another positive factor for Facebook has been the political stability in developed countries that promote Facebook’s growth. A negative political factor that influences Facebook’s growth is the obstacle of censorship in China. This is a huge loss of profit in a country with 1 billion people.
A positive technological factor that has resulted in growth for Facebook is the increase of sales of mobile devices around the world. A negative technological factor that has prevented Facebook’s growth is the rising amount of competition in the mass media industry. Companies such as Instagram, Snapchat, and Linkedin compete for the same consumers as Facebook. Another negative factor that contributes to a decrease of Facebook’s growth is that retail firm’s can compete with Facebook for advertisers.
A positive legal factor that is contributing to Facebook’s growth is the rise of businesses offering free wifi giving users more access to Facebook.
Overview of what happened during the fiscal year.
Data taken from 2016
Three Months Ended December 31,
Year-over-
Year %
Change
Year Ended December 31,
Year-over-
Year %
Change
In millions, except percentages and per share amounts
2016
2015
2016
2015
Revenue:
Advertising
$ 8,629
$ 5,637
53 %
$ 26,885
$ 17,079
57 %
Payments and other fees
180
204
(12)%
753
849
(11)%
Total revenue
8,809
5,841
51 %
27,638
17,928
54 %
Total costs and expenses(2)
4,243
3,281
29 %
15,211
11,703
30 %
Income from operations(2)
$ 4,566
$ 2,560
78 %
$ 12,427
$ 6,225
100 %
Operating margin(2)
52 %
44 %
45 %
35 %
Provision for income taxes(2)
965
2,301
Effective tax rate(2)
21 %
18 %
Net income(2)
$ 3,568
$ 1,562
128 %
$ 10,217
$ 3,688
177 %
Diluted Earnings per Share (EPS)(2)
$ 1.21
$ 0.54
124 %
$ 3.49
$ 1.29
171 %