Facebook Shares Higher As Third-Quarter Results Crush Estimates

Facebook

Ad revenue was up 68% YoY, from $6.8 billion to just over $10 billion, with mobile ad revenue comprising roughly 88% of ad revenue for the quarter, a 4% increase from this time past year.

The social network reported a net profit of $4.71bn for the quarter, up 79% year-on-year.

Away from the financials, Facebook's daily active users (DAUs) and monthly active users (MAUs) saw a YoY increase of 16 per cent. DAUs were 1.37bn on average for September 2017, while MAUs were 2.07bn as of 30 September.

Still, considering its revenue rose almost 50% to $10.3 billion, this past quarter, Facebook has money to burn.

"None of that matters if our services are used in ways that don't bring people closer together - or if the foundation of our society is undermined by foreign interference", Zuckerberg said to investors.

"With the backdrop of Facebook, Google, and Twitter in front of the Senate Intelligence Committee on Wednesday, and generally increasing discussion of regulatory scrutiny of mega-cap tech, Facebook and Mark Zuckerberg in particular placed heavy emphasis on security and the integrity of the Facebook platform" during the company's post-earnings conference call, JPMorgan analyst Doug Anmuth wrote in a note to clients Thursday. We're investing so much in security that it will impact our profitability. "Protecting our community is more important than maximising our profits", he said. EPS (GAAP): $1.59 vs. $1.28 expected, up 77% from the year-ago period.

Investors, however, it seems did not like the profitability outlook as the stock was down in after-hours trading despite the fantastic earnings report.

The analyst added that some investors might be anxious that the probed into Russian Federation meddling with U.S. politics will result in regulation on social networks that might hurt profitability. The Company's products include Facebook, Instagram, Messenger, WhatsApp and Oculus.

Advertising served up on smartphones or tablets accounted for about 88 percent of revenue taken in from marketing messages in the quarter, Facebook reported. Facebook also said that the ads possibly reached over 126 million Americans.

"I asked specific questions, I got vague answers, and that just won't do", she told the companies.

The one challenge the popular social media website faces is how it will be able prevent fake news, and how that could impact the company's operations. "What they did is wrong, and we are not going to stand for it".

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