Facebook Blasts Past Earnings Expectations

Facebook managed to widely beat Wall Street expectations with its latest earnings report, causing a 4 percent pick-up in after hours trading.

Advertising revenue pushed by sky-rocketing sales of mobile video ads managed to grow at more than twice the rate reported by Google.

By the numbers, earnings per share clocked in at $1.32, as opposed to the $1.13 analysts were looking for. Revenue came in at $9.32 billion — analysts has been forecasting $9.2 billion.  Mobile ad revenue — Facebook’s big winner on the quarter — captured $8 billion, well north of the $7.68 billion expected.

Facebook has been avidly pushing its video services — and has hinted at intentions of broadening that contribution even more widely.

“We are making some early investments to create episodic content,” Facebook Chief Operating Officer Sheryl Sandberg told CNBC.

The firm has also seen big growth in Instagram of late. According to Sandberg, over 15 million businesses can now be found on Instagram, plus 70 million who have pages on Facebook, Sandberg said.

“Our goal is to be a platform for content creators,” she said.

With the big growth in advertising revenue — 53 percent year over year — Facebook is certainly providing a tempting space for anyone looking to grab up consumer interest.  The average cost of an ad on Facebook went up pretty notably this quarter — 24 percent, according to Chief Financial Officer David Wehner. The number of ads was up 19 percent.

“As content consumption changes, online marketers are saying, ‘I want to reach consumers wherever they are, whatever device they’re using,’” David Staas, president of NinthDecimal, told CNBC. “Facebook is well-positioned” to take advantage of the trend, Staas told CNBC in a phone interview.

And Facebook, it seems, is growing to make sure it can take advantage of the trend. The social media mega-firm is building new data centers to make sure the increase and video traffic doesn’t disrupt user service.  It is also upping its headcount — as it has been. As of now, Facebook has 20,658 workers, up 43 percent from a year earlier.

“We remain very solidly in investment mode,” Sandberg told CNBC.


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