Why Facebook investors should be concerned about international growth

In the short-term, much of Facebook’s user growth will come from international markets. Unfortunately, that’s not where the money is. Based on my analysis of Facebook’s S-1, Facebook generated $13.99 in revenue for each U.S. user and $2.81 for foreign users.

I expect that some of Facebook’s highest growth markets, including India and Brazil, will have ARPUs significantly lower than even the $2.81 figure.

In the long-term, this is the right move by Facebook. But it will cause short-term margin compression.

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About Rakesh Agrawal

Rakesh Agrawal is Senior Director of product at Amazon (Audible). Previously, he launched local and mobile products for Microsoft and AOL. His personal blog is at http://blog.agrawals.org and tweets at @rakeshlobster.
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One Response to Why Facebook investors should be concerned about international growth

  1. Ian says:

    Good information to know. It is interesting to note though that Facebook is in a way the 2nd or 3rd largest country by population in the world

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