Facebook Earnings Miss on Revenue as Expenses Grow

Social media beast Facebook reported Mixed third quarter earnings after the close Tuesday. Facebook revenue missed expectations though users cotinued to grow but at a slower pace.

Social media beast Facebook reported Mixed third quarter earnings after the close Tuesday. Facebook revenue missed expectations though users cotinued to grow but at a slower pace.

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Facebook Inc. (NASDAQ: $FB) Report edEarnings After Close Tuesday

$1.76 Beat $1.47 EPS BUT $13.7 Missed $13.78 billion revenue 

Earnings

Facebook Inc. (NASDAQ: FB) reported its third-quarter earnings of $1.76 per share, beating analyst forecasts of $1.47. FB reported revenue of  $13.7 billion, missing estimates of $13.78 billion.

  • Facebook 2.27 billion monthly active users up 10% from the year-ago period. Analysts had estimated 2.3 billion users
  • Facebook.49 billion daily active users, up 9% from the year ago period. 

Shares have a 52-week trading range of $143.80 to $218.62.

Facebook second-quarter earnings of $1.74 per share, which topped consensus estimate $1.72 a share on. revenue of $13.23 billion that missed the street estimate of $13.38 billion. Last year in the same quarter, Facebook posted profits of $1.69 a share, on revenue of $12 billion.

Facebook, Inc. Common Stock NASDAQ: $FB

Market Summary > After hours $140.37 −$5.85 (-4.00%)

 

FB Earnings Q3 18

 

What Analysts Are Watching

Data Privacy

Social media data privacy and Facebook in particular has been a beacon of controversy with many hoping earnings will allow a change of focus. 

It appears that Facebook Chief Executive Mark Zuckerberg’s 10 hours of congressional testimony last quarter or so ago had been forgotten in this FOMO mania we call NASDAQ investing. This will help avoid difficult questions, perhaps but doubtful. During the conference call, expect Zuckerberg to again address questions about the impact of the Cambridge Analytica data scandal, which led to the congressional hearings. 

Advertising Revenue Metrics

Advertising accounts for the bulk of Facebook’s revenue. Investors will also be watching  for improvements in ad impression, Continued growth in the user base for the Facebook flagship social media site is a key metric. 

Stifel Nicolaus’s Scott Devitt in a note last quarter rose his price target on Facebook to $242 from $202. 

“We are incrementally positive on our mega cap U.S. digital advertising names (FB, GOOGL) in the near term, as reasonable valuation, the potential for multiple expansion, and digital advertising growth momentum continues. As reasonable valuation, the potential for multiple expansion, and digital advertising growth momentum continues.” He added that his “agency checks indicate continued momentum.”

Instagram

With Instagram now Facebook’s fourth platform to exceed 1 billion users while launching IGTV. There is much excitment here, Updated user growth or engagement information are expected to show that adoption of the app is accelerating,

Facebook’s future growth may well depend on the success of Instagram, as its own user growth is slowing.

Messaging Apps

Facebook’s messaging apps with WhatsApp and Messenger users sending a combined 100 billion messages per day, along with 3 billion minutes of video and voice calls last quarter. Investors are expecting monstrous growth as usual.

From Last Year: Facebook $FB Buys tbh Anonymous App To Compete With $SNAP 

FB User Base June 2018

 Highlights

Facebook Inc. Q2 Earnings Recap

$1.74 beat $1.72 EPS BUT $13.23 Missed $13.38 billion revenue forecast

Earnings

Facebook second-quarter earnings of $1.74 per share, which topped consensus estimate $1.72 a share on. revenue of $13.23 billion that missed the street estimate of $13.38 billion. Last year in the same quarter, Facebook posted profits of $1.69 a share, on revenue of $12 billion.

Facebook, Inc. Common Stock NASDAQ: $FB

Market Summary > After hours 178.47 −39.03 (-17.70%)

Highlights

  • Global daily active users (DAUs): 1.47 billion vs. 1.49 billion 
  • North American DAUs: 185 million vs. 185.4 million
  • European DAUs: 279 million vs. 279.4 million
  • Average revenue per user (ARPU): $5.97 vs. $5.95,
  • Comaprisons are according to a StreetAccount and FactSet estimate

FB Earnings Q2 18

 Source: Traderscommunity, Facebook, AlphaStreet 

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