Facebook doubled its profits
Facebook shares rose 6 per cent after the company released its financial report for the first quarter of 2021, far exceeding Wall Street expectations.
Facebook (FB) reported strong results for the first three months of 2021 on Wednesday after the market closed, as its advertising revenues rose as economies recovered amid a massive COVID-19 vaccination and the lifting of quarantine restrictions.
Facebook's first-quarter profit rose 93% to $3.30 per share, a full $0.93 better than analysts' average estimate of $2.37. Quarterly earnings rose to $9.50 billion, up from $4.9 billion a year earlier.
Revenue rose 47.5% to $26.17bn, also above the Wall Street estimate of $23.67bn.
Facebook executives said the strong growth in advertising revenue was driven by a 30% year-on-year increase in average price per ad and a 12% increase in the number of ads shown.
Facebook's user base has shown a modest but steady growth rate consistently from quarter to quarter. At the end of March 2021, Facebook's active users averaged:
daily active users (DAU): 1.88 billion, up 8% year-on-year. monthly (MAU): 2.85 billion, an increase of 10% over the same period last year.
Forecast from Facebook
The company expects total revenue growth to remain stable or slightly accelerate in the second quarter of 2021 compared to the growth rate in the first quarter of 2021.
Also, the company stated that it still expects the negative impact of ad targeting to intensify in 2021 due to regulatory and platform changes, in particular the recently released iOS 14.5 update, whose impact we expect to start in the second quarter.