Investors had discovered that
) had solved its "mobile problem" during its fiscal 2nd quarter
of 2013. After the bell today, Facebook reported Q3 earnings,
indicating further strength in its mobile business. The company
posted a GAAP EPS of 17 cents per share on revenues of $2016
million in the quarter -- both of these figures outperformed the
Zacks Consensus Estimates.
Analysts has expected 13 cents per share and $1913 million in
revenues, so count this as a 30.77% positive surprise on the
bottom line on more than $100 million in sales than expected.
This follows a 44.44% beat in the 2nd quarter, with its mobile
business finally demonstrating traction. With the improved
fortunes of Facebook's growth trajectories, there was some
concern going into this quarter that increased costs may have
been a headwind, but the company seems to have gotten past it.
Daily active users increased 25% and advertising revenue is up
66% year over year -- very likely further reflections on its
positive mobile business. Ad revenue holds a similar key to the
fortunes of firms like
) and even
Streamlining those ads further -- and there were reports that
some Facebook users have complained about targeted marketing
campaigns not accurately addressing their wants -- may constitute
further growth in coming quarters, based on advertisers paying
potentially higher rates to get at their target markets more
readily, even if Facebook membership grows at a more decelerated
pace going forward.
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For the December quarter, the Zacks Consensus Estimate is for
Facebook to book $2200 million in sales. For this company, a Q4
holiday season doesn't really account for a lot of this -- FB's
growth is more incremental. Today's press release did not include
Q4 guidance, but this trajectory clearly supports healthy growth
realizations for the company. Before users accessed Facebook on
their mobile devices, this crucial issue was still in question.
It doesn't seem to be anymore.
While the stock price trickled down in regular-day trading
Tuesday before the announcement, FB shares have climbed over 9%
in the after-market. This puts the stock up near its all-time
highs of $54 and change, which it touched a couple weeks ago.
You'll recall this was anything but the case back when Facebook
went public, stumbling out of the gate and taking over a year to
finally get back up to its IPO price.
From here right now, however, it appears the sky's the limit for
Mark Zuckerberg & Co.