Facebook India profit doubles in fiscal 2020

Social media giant Facebook India’s profit for the last financial year doubled to Rs. 135.78 crore from Rs. 65.33 crore posted during the year earlier, according to the regulatory filings.

The company’s revenues for the year went up 43% to Rs. 1,277.39 crore, according to Registrar of Companies filing, which were shared by market intelligence firm Tofler. The company’s total expenses for the fiscal were reported as Rs. 1,046 crore.

“India is an important market for Facebook and we are deeply committed to being an ally in the country’s socio-economic transformation. We will continue to invest in our India operations while working with small and large businesses to help in their economic recovery post the pandemic,” said a Facebook spokesperson.

Facebook India acts as a non-exclusive reseller of advertising inventory to customers in India. This means it purchases advertising inventory from the parent company and sells it to Indian customers.

As a local reseller, Facebook India reflects the revenue supported by the local sales support teams, both directly with clients and by working with media agencies and advertisers. As per the filing, the gross amount billed to advertisers was Rs. 6612.66 crore during fiscal 2020.

These revenues consist primarily of advertising revenues generated by displaying ad products on Facebook, Instagram, Messenger, and third-party affiliated websites or mobile applications. As a reseller of advertisements, Facebook India registers only a percentage commission as revenues here. The company also provides IT/ITeS, marketing and other support services to the Facebook group.

Facebook India moved to the local selling for ads model in October 2018. It has 6 months of advertising revenues reflecting in its profit & loss statement for the financial year ending on March 31, 2019.

The company paid an equalisation levy of Rs 369.5 crore in the fiscal under review as against a payment of Rs 118.2 crore in the fiscal ended March 2019. In India, 6% equalisation tax is levied on gross payments received by global digital companies from Indian residents for online advertising.

Google India reported revenue growth of 34.8% to about Rs. 5,593.8 crore in fiscal 2020 over the previous financial year, as per regulatory documents. The company is also a reseller of advertising inventory in India for the parent company.

Facebook India profit doubles in fiscal 2020 Facebook India profit doubles in fiscal 2020 Reviewed by TechCO on 12/23/2020 Rating: 5

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