The social media giant had a wonderful 2015 despite of the slow economy.
As the social media giant Facebook Inc. reported better than expected earnings report on Wednesday, the stock of the company rose by 9.8%. For the fourth quarter, it managed to outperform the estimations of analysts at Wall Street.
For the quarter, the social media network reported revenue of $5.84 billion with earnings of 79 cents per share – the highest any Wall Street analyst had predicted the earnings to go was 75 cents with revenue of $5.67 billion, as mentioned in the data collected by Thomson Reuters. Additionally, a number of analysts had just predicted for the networking website to report earnings 68 cents and revenue of $5.37 billion.
The chief executive officer, Mark Zuckerberg stated that 2015 was an incredible year for the social media as it continued to grow and the business managed to thrive throughout the year. In the after-hours trading, Facebook stock rose by as much as 12%. Additionally, the Silicon Valley giant was not the only social media that performed well on Wednesday, LinkedIn as well as Twitter Inc. performed well as their shares saw an increase.
The earnings reported by the company indicate the EPS to have raised by as much as 46% as during the same quarter in the previous year it was 54 cents however the revenue managed to show an increase of 52% - while back in 2014 it was around $3.85 billion. In 2015, the total revenue was $17.93 billion indicating a year over year growth of 44%.
Additionally by the end of the quarter, the company witnessed an increase in its monthly active users to over 1.59 billion whereas the analysts at the Wall Street were expecting the social media network to report an increase in monthly active users of nearly 1.58 billion. They had also expected the organization to report monthly active mobile users to be 1.43 billion but according to the earnings report it grew to 1.44 billion. So the social media managed to outperform the analyst’s expectations every point.
Facebook reported that over 90% of the monthly active users were on from their smartphone – which is a first for the organization. The CEO stated that Facebook users spend over 100 million hours watching videos on the platform every single day, and because of that reason the company is working on giving a separate platform to its users to view videos daily. This news by the CEO says a lot about having a new potential competitor for YouTube, in the market.
Sheryl Sandberg, the chief operating officer stated that users are moving towards using the website on their phones so they are moving their focus towards providing advertisement on it. She added that despite of the fact that the macroeconomic conditions of the market are bad and are affecting all the businesses in the market – but she believes that their platform has a stronger positioning and knows how to take advantage of whatever the market situation is. She further added that to keep the customer retained the company has a lot of hard work ahead.
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