Facebook Posts Better-than-Expected Sales and Earnings

Facebook, Inc. (NASDAQ: FB) reported fourth-quarter earnings that beat analysts’ estimates, boosted by robust advertising revenue from mobile. The social media giant said revenue jumped 51 percent to $8.81 billion in the quarter ended December, beating analysts’ average estimates of $8.51 billion. Excluding certain items, earnings was $1.41 a share in the fourth quarter.

The strong earnings were driven by robust mobile ad revenue. Advertising revenue was up 53 percent to $8.6 billion. While mobile advertising revenue represent about 84 percent of advertising revenue.

“I see video as a mega trend on the same order as mobile,” Mr. Zuckerberg said Wednesday. Facebook is the world largest social media platform. Daily active users were 1.23 billion on average for December 2016, an increase of 18% year-over-year.

“In most mature markets, to see people come on the platform more often, that’s a very good trend,” said JMP Securities analyst Ron Josey. “And the mature markets are your most profitable.”

However, the company warn that it might see slower ad growth rate in 2017. The company also said it will increase its investment on new data centers and hire more engineers this year.

“There’s effectively no change in the outlook,” Chief Financial Officer David Wehner said in an interview. “We continue to invest aggressively to grow out the business for the long term.” Facebook shares were flat in the early trading in New York.

Leave a Comment