Facebook has gone out of its way to remind investors in the bluntest terms possible that it thinks long-term, and will not manage the business to make quarterly earnings targets.
Mark Zuckerberg hinted at it in his letter to investors in the company's initial IPO filing, and showed his disinterest in Wall Street by showing up to the investor roadshow in his trademark hoodie.
But in case that wasn't enough, today Facebook updated its IPO filing again with an example of how it's going to work. New section in bold:
Our culture also prioritizes our user engagement over short-term financial results, and we frequently make product decisions that may reduce our short-term revenue or profitability if we believe that the decisions are consistent with our mission and benefit the aggregate user experience and will thereby improve our financial performance over the long term. As an example, we believe that the recent trend of our DAUs increasing more rapidly than the increase in the number of ads delivered has been due in part to certain pages having fewer ads per page as a result of these kinds of product decisions.
Got that? Product takes priority over revenue.
Apparently the growing gap between usage and ad dollars is a concern for some investors, because Facebook also noted it in a section on risk factors related to mobile (new part in bold):
In March 2012, we began to include sponsored stories in users’ mobile News Feeds. However, we do not currently directly generate any meaningful revenue from the use of Facebook mobile products, and our ability to do so successfully is unproven. We believe this increased usage of Facebook on mobile devices has contributed to the recent trend of our daily active users (DAUs) increasing more rapidly than the increase in the number of ads delivered.
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