Facebook stock spikes on strong Q1 revenue growth
Facebook's stock was up more than 6% in after-hours trading Wednesday, after it reported strong Q1 revenue results, which it attributed to growth in its advertising business. It also exceeded Wall Street expectations on earnings per share.
Yes, but: The tech giant missed Wall Street expectations slightly on user growth, suggesting its consistent user growth throughout the pandemic has begun to slow slightly.
Details: Facebook said it saw a 30% year-over-year increase in the average price per ad last quarter, as well as a 12% increase in the number of ads delivered.
By the numbers, per CNBC:
- Earnings: $3.30 per share vs. $2.37 per share forecast
- Revenue: $26.17 billion vs. $23.67 billion expected
- Daily active users (DAUs): 1.88 billion vs. 1.89 billion forecast by FactSet
- Monthly active users (MAUs): 2.85 billion vs. 2.86 billion forecast by FactSet
What's next: In a letter to shareholders, the company said it expects increased ad targeting headwinds in 2021 from the recently-launched iOS 14.5 update, which Facebook expects to start impacting its business in the second quarter.
- It also said it expects year-over-year total revenue growth rates to "significantly decelerate sequentially" as the company lap periods of increasingly strong growth during the end of last year.
Go deeper ... Facebook's earnings over the past year: