Always mind boggling to see those margins on that sort of volume. It’s no question FB is one of the greatest money-printing machines ever built.
Where does the growth come next though? Do they need to diversify their revenue streams away from advertising? Do they just start paying out dividends or can they really reinvest earnings at a sufficient return to satisfy shareholders?
Facebook's forward growth is going to come from persistently leveraging the userbase with a continued, gradual slowdown in growth. They don't need to diversify their revenue stream, they're growing sales at 30% and are larger than Oracle. Their social monopoly is going to make it very difficult for them to do meaningful acquisitions freely (unless they're well outside social). They couldn't easily buy the next YouTube, WhatsApp or Instagram at this point due to anti-trust concerns.
They did selectively start buying back shares recently as a form of capital return. I'd expect that to continue to the extent the stock remains modestly priced versus the business growth rate.
If all they do is keep on the same path, they easily get from here to $100+ billion in sales by doing nothing special beyond what they're already doing. Plus ~$35 billion in profit to go with it.
A mere 6% average sales growth per year for the next ten years gets them to $100b in sales. More likely, they get there in fiscal 2022 without much trouble.
That's assuming that anyone considers "social media" a monopoly category. Are they a social media company, or an online ad company? Which would give them several legitimate competitors. Or maybe they are just an advertising company, which makes them a medium sized fish in an ocean of advertising companies.
I'm amazed they haven't taken a crack at Google with a search engine in their app. Imagine how valuable combining Facebook's data with the user intent of search? A lot of users would never leave the facebook app on their phone if they could get a search engine that's halfway decent. It seems like they are leaving a ton of money on the table as it stands
If its too much to develop their own maybe they could team up with Bing or something?
They tried that with mobile already, and with 93% of ad revenue from mobile I'm guessing laptops are pretty irrelevant to them even if they can make one sell with their own OS.
Where does the growth come next though? Do they need to diversify their revenue streams away from advertising? Do they just start paying out dividends or can they really reinvest earnings at a sufficient return to satisfy shareholders?