Shown Above: WhatsApp co-founders Jan Koum (L) and Brian Acton(R)
In a filing Tuesday, social networking company Facebook said that Whats App lost around USD 230 million in the first half of the year on revenue of USD 15 million despite having 600 million users. Facebook’s growth is down from 3.125 percent last quarter to 2.27 percent this quarter, and its shares slowed 9.76 percent in after-hours trading.
Facebook closed Whats App acquisition with an additional USD 3 billion to the initially stated USD 19 billion due to increased value of Facebook’s stock in recent months.
According to a WSJ report, on Tuesday WhatsApp co-founder and CEO Jan Koum said, “The company scaled back efforts to make money after acquisition because we didn’t have the long-term financial support of Facebook. With Facebook’s support, WhatsApp can now focus on mainly user growth. At some point we’ll get to a billion, two billion users. Revenue is something that… will happen five years from now, maybe later.”
Facebook makes its revenue from advertising while Koum said, Whats App has no plans to generate revenue from running ads on its messaging service. WhatsApp user growth is coming from Brazil, India, Mexico, Russia and Turkey, where more people are downloading the app.
As per Tech Crunch report, Twitter also reported slow growth of 4.8 percent yesterday. The online marketplace Amazon calculates USD 437 million loss in third quarter with a revenue of USD 21 billion, after then it invested on new-product development, music and video licensing. The search engine company Google also spending in its business and technology to fuel the growth.
Facebook said on Tuesday that, its profits will be slimmer in the coming months and years as it invests in future technology and hires a wealth of employees from acquisitions such as WhatsApp.