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Facebook beat Wall Street’s expectations with its third quarter financials but the company’s stock plunged more than 10 percent during after-hours trading as analysts became cautious about future quarters.
The social network reported Tuesday quarterly revenue of $3.2 billion, a 59 percent increase from the same period last year, on adjusted earnings of 43 cents per share. Both metrics came in just above analyst estimates, which pegged revenue at $3.1 billion and adjusted earnings at 40 cents per share.
Advertising brought in $2.96 billion in revenue, an increase of 64 percent from the same period last year. Mobile advertising, meanwhile, grew 49 percent and represented 66 percent of the company’s total advertising revenue.
“This has been a good quarter with strong results,” said Facebook founder and CEO Mark Zuckerberg. “We continue to focus on serving our community well and continue to invest in connecting the world over the next decade.”
Monthly active users on the platform grew 14 percent to 1.35 billion and mobile MAUs grew 29 percent to 1.12 billion.
On a conference call with investors, Zuckerberg noted that Facebook continues to see opportunity for Oculus VR over the long term, noting that 100,000 developer kits have shipped and that Oculus hosted its first developer conference this September.
He also noted that the company expects video sharing to become more prevalent on the platform. But chief financial officer David Wehner also warned that costs would rise as much as 70 percent as the company grows its video offerings and invests in talent.
Facebook also issued guidance that shows revenue growth slowing to between 40 percent and 47 percent. Those warnings caused Facebook’s stock, which ended the day up less than 1 percent to $80.76, to dip more than 10 percent in after-hours trading during the company’s conference call with investors.
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