Kenneth Wisnefski, May 6, 2015
Ken Wisnefski penned an article for Jim Cramer's theStreet.com, here's an excerpt:
With more digital ad budgets shifting away from Google and into Facebook's ad platform, is it possible that Facebook simply can't meet the demand placed on it by its advertisers? It certainly appears that way, at least to us in this agency. Companies like ours control a large portion of Facebook's revenue, so it's easy to imagine that the company could be leaving millions of dollars on the table.
The demand for placement on Facebook's ad serving platform has skyrocketed largely in part because of its complete dominance in the mobile ad serving sector. Mobile advertising accounted for 73% of all of Facebook's ad revenue in the first quarter, compared to 59% in the first quarter of 2014. All of this increased demand for ad space has pushed Facebook to hire more employees to meet the needs of advertisers and in turn, leverage more revenue growth. Facebook's employee headcount has risen almost 50% higher in the last year, but even with that increase, can the company meet growing demand from some of its most important customers, who are thirsty to place more ad budget onto its platform? If our example is an indication, perhaps not.
