The advertising juggernaut that is Facebook Inc (NASDAQ:FB) just unveiled some hugely bullish news for its photo-sharing app Instagram, which is seeing strong advertiser growth.
Instagram management said that the number of advertisers using its platform to reach its massive audience has swelled to over 500,000, more than doubling in the past six months alone. From Reuters:
Instagram, the popular picture-sharing app that uses Facebook’s ad technology to target highly specific audiences, has gained traction as the preferred platform used by ad agencies for social media campaigns.
The app, which has more than 500 million users, also said more than 1.5 million businesses had switched to its Business Tools program in the two months since its launch earlier this year.
Instagram was bought by Facebook in 2012 for $1 billion, in a move that was panned by some analysts at the time as too expensive. Now, Instagram is on track to book $1.5 billion in 2016 ad revenue alone, according to those same analysts.
Facebook has been aggressive with acquisitions over the past several years, adding Instagram, WhatsApp, and Oculus Rift to its suite of properties. The company’s massive advertiser base on its namesake platform makes it relatively simple for it to convince those same advertisers to spend money on similar properties, and its proprietary algorithm allows companies to serve ads to highly-targeted audiences.
Facebook shares rose $0.42 (+0.32%) to $130.36 in Thursday morning trading. Year-to-date, the world’s largest social network has seen its stock rise 24.5%, more than quadrupling the return of the benchmark S&P 500 during the same period.