Instagram was a great purchase from Facebook. It was an incredibly popular app thanks to its cool interface and a list of filters with weird names and for a $1 billion dollars, it was a steal for the giant social network.
It has grown over time to an impressive 400 million users, which is a higher count than the much older Twitter with its 320 million users. Its relatively large user base plus its links with its mother ship Facebook gave it an opportunity to be a major cash cow for the company and analysts are predicting just that.
According to CNBC, analysts from Credit Suisse are predicting that Instagram will rake in a lot of money for Facebook. Apparently, they estimate that Instagram will rake in over $3 billion in 2016, which is triple what Facebook paid to acquire the company. The estimated figures are $572.5 million earned in the first quarter which is 78% year on year growth and a total of $3.2 billion. Credit Suisse also highlighted why Facebook has been targeting the mobile market as mobile ad revenue will account for 82% of the total ad revenue for the first quarter this year.
These new figures are higher than what was being predicted last year where Instagram was estimated to pull over $2.8 billion by 2017. This is not a shocker because recently Instagram announced that they have over 200,000 advertisers on their platform and we have been seeing more and more ads being populated on our timeline. We will be able to know how well Instagram is doing when Facebook announces their first quarter results in a weeks time.