Facebook Easily Shares Rally Top Street View as Quarterly Results


Facebook Inc shares were halted in an extended session on Thursday after the social media giant extended Wall Street estimates for the second quarter and addressed how advertiser boycotts could potentially affect their business.

Facebook fb,
+ 0.51%
Shares rose more than 7% on Thursday after trading, edging up 0.5% to close the session at $ 234.50, and up about 6.3% in the extended session.

In the year-ago quarter, the company reported net income of $ 5.18 billion, or $ 1.80 per share, compared to $ 2.62 billion, or 91 cents a share. Revenue rose 11% to $ 18.69 billion from $ 16.89 billion a year earlier. Analysts polled by FactSet expected adjusted earnings of $ 1.39 on sales of $ 17.34 billion.

Monthly Active Users, or MAU, a key indicator of Facebook’s growth and advertising appeal, has improved to 2.7 billion. FactSet analysts had estimated 2.63 billion, up 8.8% from 2.41 billion a year earlier. Daily active users, or DAUs, rose 12% to 1.79 billion, while analysts expected 1.75 billion.

Read more: Facebook faced many storms, but the latest is coming to its core

The embattled company is in the grip of worldwide boycott by more than 1,100 companies that object to profane language, violent content and misinformation on Facebook’s digital platform. Who among the major brands have either added their name to the #StopHateForProfit campaign or Coca-Cola Inc. Has drawn its advertising range from KO.
-0.68%
And Starbucks Corp. SBUX,
-1.00%
To Ford Motor Company F,
-2.60%
And Microsoft Corp. MSFT,
-0.07%.

“We do not benefit from misinformation or hate,” said Facebook CEO Mark Zuckerberg on a conference call.

The full scope of the boycott’s financial damage will not be known until Facebook reports its third-quarter results. On the call, Facebook’s chief financial officer, David Wenner, said the company’s 100 largest advertisers accounted for just 16% of revenue in the second quarter, down from a slightly lower percentage a year earlier.

Facebook’s three-fourths of its revenue comes from small and medium-sized companies, although it remains to be seen if those companies pull hands on ad spending while in the grip of a bad epidemic.

See also: Here are the major brands that have pulled ads from Facebook

Wener said that in the first three weeks of July, Facebook’s year-over-year growth in ad revenue was in line with second-quarter revenue growth of about 10%.

“We expect our full quarter Q3 year-over-year ad revenue growth rate to be similar to this July’s performance,” said Weiner, with the boycott reflected in the trend, along with factors such as economic insecurity.

Wehner said MAU and DAU expect to remain “in flat or slightly downstream areas” in the third quarter.

On the call, Zuckerberg said that Facebook has more than 9 million active advertisers and cautioned that a boycott of advertising could hurt Facebook’s revenue, “the huge cost of such a move is the cost of advertising and opportunities for small businesses.” Will have to reduce its effectiveness. ”

“It will reduce opportunities for small businesses so much that it will likely be realized at a macroeconomic level,” Zuckerberg said. “And is this really what policymakers want in the midst of an epidemic and recession?”

Zuckerberg was one of four tech CEOs – Apple Inc. AAPL of,
+ 1.21%
Tim Cook, Amazon.com Inc. Of AMZN,
+ 0.60%
Jeff Bezos and Google Parent Alphabet Inc. Beautiful Pichai of GOOGL,
+ 0.97%
TCS,
+ 0.62%
Others were – to testify before a House Opposition subcommittee on Wednesday. (Facebook was originally scheduled to report second-quarter results on Wednesday but was pushed back until Thursday.)

Facebook shares are up 14% this year. Comprehensive S&P 500 Index SPX,
-0.37%
In 2020 it is 0.6%.

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