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Facebook Shares Jump in Response to Impressive Third Quarter Earnings

Summary:
Facebook is one of the most attacked companies in the world as it always seems to be swimming in one legal or regulatory battle or the other (especially in relation to its Libra project), at pretty much every point in time. However, the social media giant is still also one of the world’s most successful companies and has proven it time and again, most recently with its recent third-quarter earnings figures. Facebook’s numbers exceeded expectations and well enough for its stock (FB) to hit 8.01, a rise of over 5% in after-hours trading, in response to exciting figures posted for its Q3 earnings.According to an official publication, Facebook pulled in a .65 billion revenue, almost 0 million more than the predicted .37 billion, and 29% year-over-year. Earnings per share also stood

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Facebook is one of the most attacked companies in the world as it always seems to be swimming in one legal or regulatory battle or the other (especially in relation to its Libra project), at pretty much every point in time. However, the social media giant is still also one of the world’s most successful companies and has proven it time and again, most recently with its recent third-quarter earnings figures. Facebook’s numbers exceeded expectations and well enough for its stock (FB) to hit $198.01, a rise of over 5% in after-hours trading, in response to exciting figures posted for its Q3 earnings.

According to an official publication, Facebook pulled in a $17.65 billion revenue, almost $300 million more than the predicted $17.37 billion, and 29% year-over-year. Earnings per share also stood at $2.12, as opposed to a prediction of $1.91 with these two exceeded forecasts set by Refinitiv, a financial market data provider.

FactSet, another provider of financial data analysis, put the company’s active daily users at 1.61 billion with monthly users at 2.45 billion. Facebook, however, hit FactSet’s target at 2.45 billion which is still 1.65% higher than the 2.41 billion from Q2, but exceeded the active daily users figure, hitting 1.62 billion which is 2% higher than last quarter’s 1.587 billion. FactSet also set $7.09 as Facebook’s average revenue with the company exceeding that as well, reaching $7.26.

Facebook as a whole, with all of its different apps, boasts a cumulative 2.8 billion active monthly users, still an increase from its second-quarter figures. Facebook ads have also been an amazing channel for income and continue to grow, even in an online ad industry that includes Google. Regardless, there has been considerable growth in ads on Instagram as well as its Stories feature. Mobile advertising seems to be the cash cow as it represented 94% of Facebook’s total ad revenue. This shows a 2% growth from 92% of total ad revenue in the same period last year.

Further growth was also seen in specific jurisdictions including an increase from 286 million to 288 million in active daily users in Europe, from Q2. Furthermore, the number of users in the U.S. and Canada also increased from 187 million in Q2 to 189 million in Q3.

Refinitiv has predicted that figures from Q4 would be a 24% growth, which would mean a percentage reduction of about 5 points from Q3’s 29%.  Facebook Chief Financial Officer Dave Wehner seemed to corroborate this as he has also added that Q4 growth would ease up a bit, although the drop would be a single digit.

Facebook CEO Mark Zuckerberg has highlighted the Q3 growth and also suggested that the company is not just concerned with growth, but also interested in using the platform to improve lives. He stated:

“We had a good quarter and our community and business continue to grow. We are focused on making progress on major social issues and building new experiences that improve people’s lives around the world.”

Regarding this move, Facebook launched two new features including Facebook News in partnership with several major media platforms, as well as Preventive Health, a feature that allows users to be more proactive about health issues, in a bid to prevent serious complications.

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