Facebook Shares Rise 17 Percent After the Closing Bell
UPDATED: The giant social network reported better-than-expected quarterly results.
Facebook on Wednesday reported quarterly earnings -- excluding some items -- of 19 cents per share on revenue of $1.8 billion, beating the expectations of Wall Street and sending shares higher after the closing bell.
Analysts were expecting Facebook to earn 14 cents per share on revenue of $1.62 billion.
Revenue in the second quarter was up 53 percent over the same period a year ago when Facebook reported a loss.
Since Facebook's high-profile initial public offering, its stock is down more than 33 percent as investors fret about the social network's strategy for making money from its mobile users and whether it can keep growing at a rapid clip. Investors on Wednesday, though, seemed happy about Facebook's progress in those areas.
Facebook shares rose 1.5 percent on Wednesday to $26.51 and were up 17 percent after the closing bell.
Facebook said daily active users in June rose 27 percent year-over-year to 699 million, while monthly users were up 21 percent to 1.15 billion. Mobile daily users were at 469 million in June.
Facebook said that among its highlights during the second quarter was that it surpassed one million active advertisers. Also, Facebook introduced video for its Instagram asset, and four million videos were uploaded in the first 24 hours.
The company said 88 percent of its revenue came from advertising, and 41 percent of that came through mobile ad sales.
During a conference call with analysts on Wednesday, CEO Mark Zuckerberg sought to ease fears that teenagers were losing interest in Facebook, as some polls have indicated.
"Based on our data, that's simply not true," Zuckerberg said. In fact, he said, the reason Facebook isn't rapidly growing among teenagers is because "we've been fully penetrated in the teen demo for a while now."
Zuckerberg also said that the company will introduce advertising to Instagram "when the right time comes," though for now they're focused on growing the user base. About 130 million people a month use Instagram.