Meta India clocks gross ad revenues of Rs 16,189 crore in FY 2021-22

The company’s net profit grew by 132% year on year to Rs 297 crore during the same period.

Facebook India Online Services ended up paying a Rs 907 crore equalisation levy to the government on the gross ad revenues in fiscal year 2021-22, as per the ROC filings.

Facebook India purchases advertisement space from Meta Platforms Inc USA.

When selling to their Indian customers, Meta India applies some markup to the cost of goods sold.

For Meta India, Rs 15,120 crore was the cost of ad inventory.

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Meta India’s total income in fiscal year 2021-22 was Rs 2,324 crore and that includes the net advertiser reseller revenue (Rs 889 crore), IT-ITES services (Rs 1,420 crore) and other income (Rs 15 crore), as per the filings.

The company’s net profit is earned from this net income.

In fiscal year 2020-21, the company clocked gross ad revenues of Rs 9326 crore and posted a net profit of Rs 128 crore on an income of Rs 1481 crore. In fiscal year 2019-20, the tech major clocked a net profit of Rs 136 crore on an income of Rs 1216 crore.

Media buyers familiar with matters at both Meta and Google said the gap between the two is shrinking. “Google reported gross ad revenues of around Rs 13,887 crore last year, and Meta has reported gross ad revenues of Rs 16, 189 crore for fiscal year 2021-22. The gap between the two seems to be decreasing. If you look at Meta’s growth, it has been more than Google’s growth every year,” said a media buyer who works with both platforms.

A media buyer said Reels has driven growth on Instagram, videos has driven growth overall, and the growth of Meta’s platforms in general has been more. “The pandemic drove digitisation and this growth has come despite the peak wave of Delta when the economy almost came to a halt for a few months. I think a lot of the growth has been driven by smaller businesses and new ventures. From an industry point of view, consumer tech, CPG, financial services and the whole direct to consumer category has done really well for the Meta properties,” the person said.

According to industry insiders, Google and Facebook continue to roughly corner over 70 of the digital advertising pie in India, and this has been the case for the last few years, indicating a duopoly that has only been strengthening.

Globally, Meta Platforms Inc reported revenue of $28.82 billion in Q2 2022, down from $ 29.07 bilion a year ago. It reported a profit of $ 6.69 billion, down 36% from the previous year.

In major markets, the technology giant has been facing stiff competition from TikTok and Amazon for ads and was hit hard by Apple’s privacy changes to its mobile operating system iOS that allowed users to opt out of digital tracking but that hasn’t been the case in India as the country is primarily an android market.

The CEO of a digital agency said the India results need to be seen in the country’s economic context.

“I think we are in the middle of this massive digitisation and the economy has been doing well. The growth of the platforms has continued and therefore supply has not been an issue,” the person added.

As per GroupM futures report ‘This Year, Next Year’ (TYNY) 2022, ad spends are estimated to reach Rs 107,987 crore in 2022 in India, with a growth of 22% for calendar year 2022.

In an interview with ET last month, Ajit Mohan, managing director of Meta India had said there were three areas where the company has put in disproportionate energy and investments over the last two years–video (in particular Reels), building a proposition for small businesses, and a partnership with Jio.

He said the pandemic accelerated digital transformation and Meta is benefitting from the transition from offline to online and that transition continues to be well underway.

Mohan had also said that while both Facebook and Instagram are growing “really fast” in India, the momentum has been especially driven by Reels on Instagram, which is also there on Facebook now.