Morning Business Memo…

Facebook is spending more but also making more. Advertising revenue from mobile apps surged as Facebook sales rose 40 percent in the latest quarter. The firm's profits declined sharply though, which led to a 6 percent drop in its share price overnight. Despite the doubters, Facebook's recovery since last summer has been impressive. Weeks after the ill-fated IPO, many critics said the company no clear strategy for making money from advertising revenue. Now mobile apps account for 23 percent of Facebook's overall revenue, compared with 14 percent in the previous quarter. "Today, there is no argument. Facebook is a mobile company," CEO Mark Zuckerberg told analysts and reporters after the quarterly results were announced.

More than ever the auto industry is making fuel economy a top priority. With gas prices rising again this may be good news for consumers. "Everybody is really working toward fuel economy," Eddie Alterman, editor-in-chief of Car and Driver, tells ABC News Radio. It's not just a small car story. Sports cars and other luxury brands are also in a race for better mileage, using lighter materials and new fuel-efficient engines. "All this new technology has really, really pushed the envelope on sports car fuel economy," says Alterman. Government mandated mileage standards are behind the big shift. "Everybody has to hit by 2016 this number of 54.5, which translates to about 47 MPG on the sticker for the whole fleet."

Chinese hackers repeatedly penetrated The New York Times' computer systems over the past four months, stealing reporters' passwords and hunting for files on an investigation into the wealth amassed by the family of a top Chinese leader, the newspaper said today. "The timing of the attacks coincided with reporting for an investigation that found that the relatives of China's prime minister had accumulated a fortune worth several billion dollars through business dealings," the Times reports. Security experts hired to investigate and plug the breach found that the attacks used tactics similar to ones used in previous hacking incidents traced to China. The paper says the hackers routed the attacks through computers at U.S. universities, installed a strain of malicious software, or malware, associated with Chinese hackers and initiated the attacks from Chinese university computers previously used by the Chinese military to attack U.S. military contractors.

New England's fishing regulators have approved massive cuts in cod catch limits. Fisherman in Maine, Massachusetts and New Hampshire say cod limits will trigger the collapse of the industry. The Northeast's top federal fisheries regulator acknowledges that the cuts are devastating but stocks of fish are in perilous condition.

Richard Davies Business Correspondent ABC NEWS Radio ABCNews.com twitter.com/daviesabc