Facebook Posts Flat Q1 Earnings and Significant Increase in Revenues

Michael Teague |

Facebook’s (FB) reported net income for the first quarter at $219 million, or $0.09 cents per share on revenue of $1.46 billion. Excluding one-time items, the company made $0.12 per share, which is largely in line with what analysts had been expecting. During the prior-year period, the company earned $205 million or $0.09 per share on revenue of $1.06 billion.

Revenue for the first quarter represented a 38 percent increase on the prior year, slightly ahead of expectations of $1.44 billion. But the red meat in the report was largely to be found in the impressive 43 percent year-over-year increase in mobile ad revenue that now accounts for 30 percent of the company’s entire gross income from advertising, and is a figure that hit the higher end of the spectrum of analyst expectations.

For Q4 of 2012, mobile made up 23 percent or $306 million of Facebook’s total advertising revenues.

By contrast, the first quarter’s $375 million of advertising revenue can be seen as an indication that the company’s intensifying focus on that area is paying off. Facebook’s last two big announcements, while ostensibly having to do with revamps to site design, as well as the company’s own version of an operating system for smartphones with Facebook Home, are best seen in the context of the attempt to capture a larger portion of advertising dollars from Google (GOOG), the company that currently dominates mobile advertising.

Facebook said that 665 million of its 1.11 billion users are active on a daily basis, with 189 million of those logging on exclusively through mobile devices.

Meanwhile, the company’s CFO David Ebersman said that the Q1 was the company’s best to date for revenue from games in spite of a 37 percent year-over-year decrease in payments from online gaming company Zynga (ZNGA), who has recently tried to assert its independence from the social media giant by allowing users to access games directly through its own site.

While Facebook dropped slightly in regular trading by 1.22 percent to close at $27.43, shares were almost flat after hours after some brief initial movement, up a slight 0.04 percent, or $0.01.

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Companies

Symbol Name Price Change % Volume
FB Facebook Inc. 129.23 0.54 0.42 12,047,636
GHL Greenhill & Co. Inc. 23.19 0.46 2.02 411,003
GOOG Alphabet Inc. 781.56 -1.45 -0.19 1,109,834
ZNGA Zynga Inc. 2.82 -0.06 -2.08 10,752,210

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