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Facebook doubles quarterly profit and sees spending up in 2017

Social media giant Facebook announced its fourth quarter profit beat forecasts thanks to its mobile ad revenue and increase in daily users. More than one billion people use its social media sites daily.

Facebook announced on Wednesday that 2016 fourth-quarter profits more than doubled from the previous year from $1.56 billion (1.45 billion euros) up to $3.57 billion (3.31 billion euros). Shares were up 0.2 percent in after-hours trading in New York. 

"Our business did well in 2016, but we have a lot of work ahead to help bring people together," said Facebook co-founder and chief executive Mark Zuckerberg in a statement.

Total revenue rose to $8.81 billion from $5.84 billion a year ago.

Looking forward, Zuckerberg told analysts that the company expected a major increase in hiring and
other spending during 2017 as it invests in video and other priorities. 

Business title "Fortune" tweeted that "Facebook's growth appears to be unstoppable, at least for now."

Zuckerberg said the focus would be on generating short-form, original videos, especially professionally created "episodic content" produced week-to-week.

He admitted what could be a $3 billion bet on virtual reality (VR) "won't be profitable for quite awhile." He said that the delayed shipments of the company's Oculus Rift VR headset and touch controllers were a "disappointment," and that VR sales "won’t be profitable for quite awhile."

Users should come to Facebook "when they want to keep up-to-date on what's going on with their favorite show or what's going on with a public figure," Zuckerberg said.

Not a perfect Wednesday

It was not all good news for Facebook on Wednesday. Just before the market closed, a jury in Texas ruled that Facebook's virtual reality unit "Oculus" and other defendants should pay a combined $500 million fine to ZeniMax Media Inc, a video game publisher that claimed Oculus stole its technology.

Facebook is expected to appeal the verdict.

kbd/jm (AFP, Reuters)