Facebook admits that it's worried about ad blockers

• Jillian D'Onfro
 
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• 15h
• 2,987
 
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Justin Sullivan/GettyFacebook CEO Mark Zuckerberg

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Facebook is starting to worry about ad blockers. 

For the first time, the social network highlighted ad blocking technologies as a significant risk factor in its annual 10-K filing, noting that they have impacted its ad revenue "from time to time."

Although Facebook mentioned ad blockers in its 10-K last year, too, it did so only briefly as one of many things that could potentially impact its ads businesses, whereas it dedicated a whole section to the technology this time around. 

The warning about ad blockers comes as Facebook delivered blockbuster fourth-quarter financial results and as its ad business appears to be firing on all cylinders.

Ad-blocking software, which nixes display advertising from websites, became a hot topic last year after an Apple operating-system updateallowed ad blocking on iPhones and iPads for the first time.

Facebook makes about ~96% of its revenue from advertising, so if more people started using ad blockers on all of their devices, it could "adversely affect" Facebook's financial results.

Facebook notes that the adverse impact has so far has been on PCs, which represents a decreasing slice of its overall user base. But it notes that if ad blocking technology takes hold on mobile devices, its financials could be "harmed." 

Here's how Facebook phrased the risk in its filings:

Technologies have been developed, and will likely continue to be developed, that can block the display of our ads, particularly advertising displayed on personal computers. We generate substantially all of our revenue from advertising, including revenue resulting from the display of ads on personal computers. Revenue generated from the display of ads on personal computers has been impacted by these technologies from time to time. As a result, these technologies have had an adverse effect on our financial results and, if such technologies continue to proliferate, in particular with respect to mobile platforms, our future financial results may be harmed.

Facebook isn't the only one fretting.

Last fall, Google's ads boss Sridhar Ramaswamy said that adblockers were "a blunt instrument and we need to be worried."

SEE ALSO: Facebook explodes after Q4 earnings beat

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More: Facebook Adblockers

Amazon misses, stock tanks

• Eugene Kim
 
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Michael Seto/Business InsiderAmazon CEO Jeff Bezos

Amazon.Com  $588.55

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Amazon’s slower-than-expected cloud business growth and rising fulfillment center costs took a toll on the company’s fourth quarter results.

Amazon's Q4 financial results missed Wall Street targets across the board, which is driving its stock is down more than 12% in after-hours trading.

Here are the most important numbers:

• Earnings per share (EPS): $1 vs. $1.56 estimated (GAAP).
• Revenue: $35.75 billion, up 22% year-on-year, but short of the $35.9 billion estimated by Wall Street. 

The miss largely had to do with the slowing growth of AWS, its cloud computing service. It grew 69% year-over-year to $2.4 billion in revenue, but not as fast as expected. In the last two quarters, it grew approximately 80% year-over-year.

During the earnings call, Amazon CFO Brian Olsavsky said AWS was "just short" of the $10 billion run rate it had previously projected.

There were also concerns of rising costs for its fulfillment centers, where Amazon stores its products, as it grew 33% year-over-year.

Revenue guidance in-line

Amazon gave revenue guidance in the range of $26.5 billion and $29 billion, or up between 17% and 28% compared with first-quarter 2015. Analysts are expecting $27.65 billion.

Although Amazon missed analyst expectations, its overall sales and profitability have improved.

This was the third-straight profitable quarter for Amazon, pulling in $482 million in net profit, which is also the biggest ever for the e-commerce company. 

For the full year, revenue increased 20% to $107 billion, compared with $89 billion in 2014. Operating-cash flow went up 74% year-over-year to $11.9 billion for the past year, while free-cash flow increased $7.3 billion.

Big expectations

But it looks like investors were expecting another beat, since they drove up Amazon's stock price by over 9% on Thursday afternoon, even before the company released its earnings.

Last month, Amazon indicated that it had a strong holiday season, announcing that its Prime service had a record number of units shipped, with more than 3 million new customers joining its membership program. Amazon never released exact figures for its Prime members, but CIRP recently estimated it to be 54 million, up 35% from last year.

Amazon said in its release that Prime membership, which includes free two-day shipping and access to a bunch of video and music content, grew 51% last year, and 47% in the US.

There were also multiple reports in the last quarter indicating that Amazon may possibly expand its logistics business across truck trailers, flight delivery, and ocean-freight services. Amazon typically stays coy about these things on earnings calls, but investors will keep an eye out for any mentions.

Here are some of the notable highlights Amazon shared in its press release:

• Fire TV remains the No. 1 best-selling streaming media player in the US, having added over 1,000 new apps, channels, and games since September, including NBC, NBC Sports, Watch HGTV, Watch Food Network, and Watch Travel Channel.
• The $50 Fire tablet has been the No. 1 best-selling, most gifted, and most wished-for product across all items available on Amazon.com since its introduction 19 weeks ago.
• In 2015, worldwide paid Prime memberships increased 51% — 47% in the US but even faster outside the US.
• In the fourth quarter, Prime Music streaming hours more than tripled in the US, compared with fourth-quarter 2014.
• Sellers on Amazon.in sold more in the fourth quarter than in all four quarters combined in 2014.
• Since launching in December 2014 with one location, Prime Now has grown to more than 25 metropolitan areas across the U.S., U.K., Italy, and Japan.
• In 2015, Fulfillment by Amazon (FBA) shipped over one billion units on behalf of sellers. The number of active sellers using FBA grew more than 50%.
• In the fourth quarter, FBA units represented nearly 50% of total third-party units.Amazon Web Services (AWS) announced the launch of its Asia Pacific (Seoul) Region in Korea and its plans to open a new region in Canada. The AWS Cloud is now available from 32 Availability Zones across 12 geographic regions worldwide, with another five AWS Regions — and 11 Availability Zones — in Canada, China, India, Ohio, and the UK expected to be available in the coming year.

Disclosure: Jeff Bezos is an investor in Business Insider through his personal investment company Bezos Expeditions.

SEE ALSO: Get ready for Amazon's 3rd billion-dollar business: Echo

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More: Amazon Earnings

The Central Bank
of the Russian Federation

Key rate

from 03.08.2015, %

11.00

Inflation

Main Indicators of Financial Market

Foreign Currency Market

	29.01.2016	30.01.2016
US Dollar $	RUB 77.3674	RUB ↓75.1723
Euro €	RUB 84.1370	RUB ↓81.9077

Dual-currency basket

from 30.01.2016

RUB 78.2032

Precious Metals

rubles per gram	30.01.2016
Gold Au	↓2,689.71
Silver Ag	↓32.82
Platinum Pt	↓2,088.15
Palladium Pd	↓1,191.50

Interbank Market

%	1 day	2-7 days	8-30 days
MIACR on 28.01.2016	11.04	11.51	11.50
RUONIA on 28.01.2016	↓11.11
%	1 day	1 week	1 month
MosPrime  Rate on 29.01.2016	↓11.34	↓11.47	11.78
%	1 week	2 weeks	1 month
ROISfix on 29.01.2016	↑11.12	↓11.08	↓11.04

Interest rates on operations of Bank of Russia

The Bank of Russia claims on the credit organizations

Banking sector liquidity indicators

Required Reserve Ratio for Credit Institutions

International Reserves of the Russian Federation

The Bank of Japan just stunned global markets by announcing negative interest rates

• David Scutt, Business Insider Australia
 

• 10h
• 14,002
 
• 10

REUTERS/Eddie KeoghA Japan fan poses before Scotland vs. Japan Rugby World Cup game on September 23, 2015.

The Bank of Japan (BOJ) has just stunned financial markets, taking official interest rates into negative territory.

Voting 5-4 in favor of the measure, the bank announced that it will charge an interest rate of -0.1% for excess reserves parked at the bank by financial institutions.

The basic idea behind taking interest rates into negative territory is to encourage lending from banks who are now charged a small amount to keep cash at the Bank of Japan, which in theory will increase economic activity. 

The BoJ also stated that it will be willing to cut interest rates further if necessary.

Akin to the same policy implemented by the Swiss National Bank, the BOJ announced that it will adopt a tiered system for interest rates, stating that outstanding balances of each financial institution at the Bank will be divided into three tiers, to each of which a positive interest rate, a zero interest rate, or a negative interest rate will be applied.

The BoJ has used the chart below to demonstrate how the tiered system will work.

Bank of Japan

“Although a negative interest rate is not applied to the total outstanding balances of current accounts, costs incurred with an increase in the current account balance brought by a new transaction will be -0.1% if it is applied to a marginal increase in the current account balance,” the BOJ wrote.

Sean Callow, currency strategist at Westpac, explains how the process will work:

From 16 Feb, the BoJ will apply a rate of -0.1% on certain deposits and says this rate could be cut again if necessary. The details show that this is a less punitive measure than at first glance, with concern over “financial institutions’ earnings”. Other central banks have negative rates on the balances of banks’ deposits over the prudentially required reserves. The BoJ is adding another layer, protecting the additional reserves created by banks’ sales of JGBs to the BoJ under QQE so far. These reserves will still attract a +0.1% rate. Reserves for prudential reasons and selected other programs earn zero. So it's only balances above these that will be penalized with the -0.1% rate, which in practice will mostly be BoJ asset purchases beyond 16 Feb.

The BoJ cited recent volatility in financial markets, particularly toward the outlook for the Chinese economy, as one of the catalysts behind its decision.

“There is an increasing risk that an improvement in the business confidence of Japanese firms and conversion of the deflationary mindset might be delayed and that the underlying trend in inflation might be negatively affected, said the bank.

“To preempt the manifestation of this risk and to maintain momentum towards achieving the price stability target of 2%, the bank decided to introduce QQE with a negative interest rate.”

Outside of interest rates, policy was left unchanged.

As they have done since October 2014, the BOJ kept its QQE program unchanged, maintaining an annual expansion in the nation’s monetary base at around 80 trillion yen.

In line with the sentiment expressed in the bank’s policy statement, the BOJ’s median core CPI forecasts were also lowered for the 2016-2017 fiscal year.

Excluding volatile items, the bank now expects inflation to average 0.8%, down from 1.4% seen in October last year. Forecasts for 2015-2016 and 2017-2018 were left unchanged at 0.1% and 1.8% respectively.

The BoJ now expects to meet its 2% inflation target around the first half of fiscal year 2017-2018.

In response to the expected positive impact that ultra-easy monetary policy will deliver, the BOJ increased its 2016-2017 median GDP forecast from 1.4% to 1.5%. That for 2017-2018 was left unchanged at 0.3%

The BoJ's tweak to interest rates, entirely unexpected by markets, created some wild movements across Japanese financial markets.

Post the announcement, the Nikkei 2255 traded in a 871-point range, rising more than 3% only to plunge by more than 1% soon after. Eventually the index closed the session at 17,518.30, up 2.80%.

Business Insider Australia

The USD/JPY had a similar reaction to the Nikkei, rallying as high as 121.33 immediately after the BOJ announcement before retracing. It’s currently trading at 120.45, up 1.38% for the session.

Business Insider Australia

Benchmark Japanese 10-year JGB yields also plummeted, falling at one point to 0.12%, the lowest level on record. Five-year JGB yields also went below 0% for the first time ever.

Business Insider Australia

While markets have responded well to Friday’s announcement, just as they did to hints from the ECB earlier this month that they too will likely ease policy further in the months ahead, the weakening in both the yen and euro will place upward pressure on the US dollar and, as a consequence, the Chinese renminbi.

At a time when both nations' trade-exposed sectors are struggling, additional monetary easing from the BOJ, and likely the ECB, will add to already strong economic headwinds buffering the US and Chinese economies at present.

Whether they will be able to sustain this additional pressure remains debatable, and will add to risks that they too will take action to stimulate economic growth within their own economies. 

Read the original article on Business Insider Australia. Copyright 2016.

Facebook's incredible mobile growth

• Matt Rosoff
 
•    

• 21h
• 627

 More Charts

 
•  
 

Facebook reported strong earnings for Q4 2015 on Wednesday, and the stock is skyrocketing — it's up about 15% as of mid-day Thursday.

Facebook owes a large part of its recent success to its mobile growth. When the company went public in spring 2012, it had zero mobile ad revenue. Now mobile advertising makes up 80% of its ad revenue. And its mobile usage just keeps on growing, as this chart from Statista shows.

Facebook added 253 million monthly users to the core mobile Facebook app in the last year, from an already high base of 1.19 billion (21%). Whatsapp, the company's largest messaging app, added 200 million (+29%), and Instagram, which is immensely popular among teens, added 100 million (+33%).

Statista

SEE ALSO: The iPhone lost market share in most of the world last year

Bank of Japan helps Asia stocks end painful month with a bang

The Bank of Japan's shock announcement that it would charge banks to hold their cash sent Asian markets surging and the yen tumbling on Friday as investors ended a highly volatile month with a bang. 

PHOTO: REUTERS

JAN 29, 20164:16 PM

[HONG KONG] The Bank of Japan's shock announcement that it would charge banks to hold their cash sent Asian markets surging and the yen tumbling on Friday as investors ended a highly volatile month with a bang.

Trading floors across the planet have been awash with red in January as investors endured one of the worst starts to a year in recent history, hit by China's economic crisis, weak global growth and crashing oil prices.

However, some stability seemed to be established over the past week on hopes that the Bank of Japan and European Central Bank will provide some support.

And on Friday, Japanese bank policy makers stepped up, unveiling a new weapon in their long-running fight against anaemic economic growth and deflation.

After a two-day meeting the bank's policy committee said it would adopt a negative interest rate policy, meaning banks pay to park their cash in the BoJ. The move aims to give banks an incentive to boost lending, which in turn should help fuel economic growth.

A similar policy was adopted by the European Central Bank in 2014, the first time by a major central bank.

"It's a surprise," Hideaki Kuriki, a bond investor in Tokyo at Sumitomo Mitsui Trust Asset Management, told Bloomberg News. "They think the ECB policy is successful so they're taking the same policy." However, some were less effusive, with Norihiro Fujito, general manager of Mitsubishi UFJ Morgan Stanley Securities, saying the bank was "pointlessly confusing the market", adding it was "symbolic of the limits of the BoJ's policies".

Still, the news sent Japan's Nikkei stock index soaring more than three percent at one point before paring the gains slightly to end 2.8 per cent higher. And the greenback jumped to 120.70 yen in the afternoon, up from 118.60 yen before the announcement.

"The decision... suggests that the yen will weaken further against the dollar in coming months," Marcel Thieliant, senior Japan economist at Capital Economics, said in a note, adding that his firm saw the dollar rising to 130 yen by the end of 2016 and to 140 yen by the end of next year.

Among other markets, Hong Kong was up 2.3 per cent in the afternoon, Shanghai surged more than three percent and Sydney ended 0.6 per cent higher. Singapore and Manila also gained almost two percent and Taipei added 2.2 per cent.

Until the rally in Shanghai, the index had endured its worst month since 1994 as dealers fret over the state of the Chinese economy and authorities' ability to handle the crisis.

And analysts warned of further problems ahead, with oil prices stuck near 12-year lows and confidence still at a premium.

"After the big sell-down we've seen in the early part of January, we're seeing a bit of stabilisation," Matthew Sherwood, head of investment strategy at Perpetual Ltd in Sydney, told Bloomberg News.

"Is this the calm before the next storm or is this a real opportunity to come in and start buying cheaper assets? I still think we're in for a very tough year." Oil prices edged up again, boosted by hopes for talks between the OPEC producers' group, which is responsible for about 40 percent of global output, and Russia to end a supply glut.

US benchmark West Texas Intermediate was 2.1 percent higher and Brent added 2.4 per cent.

The two contracts surged Thursday after Moscow said it could hold meetings with OPEC over possible output cuts that could amount to as much as five percent per country.

However, analysts warned the prices could soon fall back as they are sceptical any deal can be reached, with OPEC intent on keeping market share despite the painful hit from low prices.

The cost of crude has crashed by about three quarters since mid-2014 owing to weak demand, overproduction, the supply glut and a global economic slowdown, particularly in key user China.

AFP