AP PHOTO
NEW YORK – Facebook shares staged a strong rally Thursday, buoyed by news of stronger-than-expected profits and sizzling gains in mobile advertising revenue.
The gains came as Facebook introduced a new mobile app aimed at becoming a social newspaper of sorts for the members of the world’s biggest social network.
The stock was up 16 percent at $62.22 in midday trade a day after Facebook reported that profit in the fourth quarter jumped eightfold from a year earlier to $523 million, raising its net income for the year to $1.5 billion.
“Facebook’s ascendancy and execution in 2013 has been near-flawless,” said Deutsche Bank analyst Ross Sandler in a note to clients.
Mark Mahaney at RBC Capital Markets said he was “more positive” on Facebook after the strong quarterly report.
“The most important Internet trend by far is MOBILE, and Facebook has become a MOBILE company,” he wrote in a research note.
In another sign of its focus on mobile, Facebook on Thursday unveiled its new app called “Paper,” an online newspaper of sorts for viewing and sharing articles and other content from a smartphone.
“Paper makes storytelling more beautiful with an immersive design and fullscreen, distraction-free layouts, ” Facebook said in a blog post announcing the new service.
“We’ve also made it easier to craft and share beautiful stories of your own.”
The app, the first product from Facebook Creative Labs, will be available February 3 for iPhone users, Facebook said.
Paper presents stories and themed sections to allow people to follow topics ranging from news headlines to food to sports to science.
It has a tiled design that allows users to customize the display alongside a personal Facebook feed.
“Each section includes a rich mix of content from emerging voices and well-known publications,” the blog post said.
The partners in Paper were not named, but a video released by Facebook showed a user scrolling articles and content from The New York Times, Time magazine, USA Today, the Huffington Post and others.
“Storytelling and sharing have been reimagined in Paper to show stories at their best,” Facebook said.
“Everything responds to your touch so you can pick up or thumb through stories with simple, natural movements. You can tilt your phone to explore high-resolution panoramic photos from corner to corner, and see faces and other important details up close.”
The app will allow for full-screen viewing of videos and will “make it easy to spot articles from trusted publishers and decide what to read or watch,” it said.
Reports in recent weeks said Facebook was hiring editors or “curators” to complement its algorithmic method of delivering content to its users
Facebook’s latest earnings report showed revenues in the past quarter rose to $2.58 billion, and $7.87 billion for the year.
Facebook said the number of monthly active users rose 16 percent from a year ago to 1.23 billion, with 945 million using mobile devices.
Revenue from advertising surged to $2.34 billion in the quarter, up 76 percent over the past year.
Mobile advertising revenue represented some 53 percent of that figure, an increase from 23 percent in the fourth quarter of 2012.