Facebook profit climbs along with ranks of users

Facebook profit climbs along with ranks of users

The Wall Street Journal reports that Facebook has posted a record quarterly profit, reporting per-share earnings of $2.38 in the fourth quarter; up from $1.44 past year and beating Wall Street analysts projects of $2.18. Revenue rose 30% year over year to $16.91 billion, beating expectations by more than $500 million. "Advertisers are clearly still very reliant on Facebook, and the fact that daily active usage in both the US/Canada and Europe increased is a surprise after the flatness we saw in the US and Canada previous year and the falloff we saw in Europe".

Facebook shares jumped 7.7 percent to $161.99 in after-market trades that followed release of the earnings.

CEO and Founder Mark Zuckerberg said "We've put most of our energy into security over the past 18 months, so that building new experiences wasn't the priority over that period".

"It's clear that overall, the Facebook family of apps has the breadth of formats and the reach marketers are looking for when it comes to engaging with their audiences and placing ads", says Yuval Ben-Itzhak, CEO of Socialbakers - a Facebook marketing partner. Although the company offers no country-by-country breakdown of its users, 947 million were in the Asia-Pacific region, 381 million in Europe and 242 million in North America.

The news comes as the company deals with its latest scandal - the use of a market research app that saw the company pay users to allow Facebook to access highly personal data on their devices.

For more information, you can read Zuckerberg's full statement here.




Aaron Goldman, CMO, 4C Insights, said: "Facebook's Q4 performance represents continued advertiser confidence in the company's suite of platforms". FMR LLC now owns 124,255,610 shares of the social networking company's stock valued at $20,435,077,000 after acquiring an additional 2,132,804 shares in the last quarter. During the fourth quarter, the public learned more about how it let Russian Federation manipulate users in campaigns that continued through the 2018 USA midterm elections. He said the move is "a 2020 thing or beyond". The company said eventually, it will no longer report how many people use the social network.

The company also warned that revenue growth will slow because of shifts in its advertising business.

One analyst cautioned the risk to Facebook's stock may be further in the future, when European regulators get more deeply involved in their privacy probes.

As the number of ad placement options grows, it's getting more complicated for marketers to target audiences across Facebook's properties. In 2019, video will become an even bigger focus with formats like Stories taking center stage across the Facebook Inc. portfolio, which includes Messenger and WhatsApp alongside Instagram and Facebook.

Facebook's 60%-plus growth in net income and ne t earnings initially seems impressive.

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