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Yes. Facebook's "cost of revenue" (which they state is mostly infrastructure) was $1.875 billion in 2013, a year when they made $1.5 billion in net income. For comparison, research and development was $1.4 billion.

Facebook's business model involves getting 1 billion people to post a ton of stuff inside Facebook, costing them about $2/user/year in infrastructure, $3.50/user/year in other costs, and making about $7/user/year in advertising revenue, yielding about $1.50 in profit. So cutting costs on that $2 makes them significantly more profitable.



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