After repeatedly hearing so many issues with monetizing mobile traffic from the likes of Facebook (FB), Millennial Media (MM) continues to report massive growth.
The company reported 75% revenue growth in Q2 2012. This number bodes well for Velti (VELT) owned in our models.
The CEO of MM went on CNBC this morning. Its worth a watch for anybody interested in the sector.
One of the most important take aways from this industry is that companies moving from a reliance on desktop supported ads for revenue to mobile is having a hard time matching those numbers. In cases such as Facebook, the company wasn't even ready for the transition to mobile by customers.
Another important distinction is that a major difference exists between a retailer advertising on mobile versus Facebook attempting to place ads on mobile devices.
Companies such as MM and VELT sees gains from all the new traffic migrating to mobile. Anything is a net positive to them no matter whether it matches the old revenue ad levels or not. The market will soon figure out the difference between replacing legacy revenue with mobile and a business model focused completely on serving the mobile advertising sector.
Disclosure: Long VELT. Please review the disclaimer page for more details.