Facebook's advertising revenue in Australia is up 16% to more than $670m

Chris Pash
By Chris Pash | 2 June 2020

Most of Facebook's advertising revenue collected in Australia ended up offshore in 2019. 

According to financial statements filed with corporate regulator ASIC, Facebook’s gross advertising revenue in Australia increased 16% to $673,985,213 in 2019. 

Of that, $507,920,191 was written down as a cost of sales, meaning Facebook Australia’s advertising revenue was recorded as $166,065,022, up by a third on the year before, an amount described as “reseller” share.

The social media platform acts in a similar way to Google in Australia. Both are styled as a type of sales agent, selling on behalf of an offshore entity, also owned by the company.

This way only a portion of sales made here -- a commission or fee -- are booked as local revenue. The rest goes to the offshore related entity. 

Facebook explains: “The company acts as a reseller of advertising services to designated Australia customers through a reseller agreement with another group company and generates revenues primarily through resale of advertising inventory on Facebook.”

The social media platform describes its role as a “non-exclusive reseller of advertising services” to Australia customers. 

From the 2019 financials:

facebook ad revenue 2019

Income tax expense was $16,770,378, up from $11,781,645 in 2019, representing around 2.4% of gross advertising sales..

The after tax profit is recorded as $22,709,667, flat on 2018’s $23,261,264.

The coronavirus pandemic is having little impact so far.

“The company has continued business operations with limited disruption and has remained engaged in performing its principal activities,” says Facebook in its ASIC filings, referring to March this year.

“As the scale and duration of these developments remain uncertain, it is difficult to quantify the financial impact of the evolving situation. The Company will continue to monitor and assess, but … does not expect a material adverse impact on its ability to continue as a going concern.”

Facebook's income statement for 2019:

facebook income 2019 

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