Facebook Inc.’s first-quarter sales rose 48 per cent, surging past analysts’ estimates thanks to strong demand from retailers and other advertisers seeking to grab attention from the social network’s billions of users.
Bloomberg reports revenue climbed to US$26.2 billion, the company said Wednesday in a statement. That dwarfed the US$23.7 billion average estimate of analysts, according to data compiled by Bloomberg. Facebook reported 2.85 billion monthly active users, a rise of 10 per cent. Analysts projected 2.83 billion. Shares jumped about 6 per cent in late trading.
Menlo Park, California-based Facebook, which also owns Instagram and WhatsApp, has seen a surge in use of its platforms for at-home entertainment and keeping up with loved ones while people have been stuck in lockdown. Larger advertisers have shifted more of their marketing budgets to social media sites, while small businesses ramped up digital outreach to tap potential customers.
Net income in the March quarter rose to US$9.5 billion, or US$3.30 a share, Facebook said. Analysts on average had projected US$2.34 in per-share profit.
In the statement, Facebook said sales in the current period will remain steady or accelerate from the first quarter, but repeated its caution that growth may stall in the second half of 2021.
Facebook has been chasing future growth from burgeoning services like augmented reality and shopping. It’s already benefiting from the e-commerce boom as consumers increasingly turn to the web to avoid the risk of COVID-19 in person at brick-and-mortar stores. To meet that demand, Facebook last year reinvested in its shopping services, which let retailers upload product catalogs to their Facebook page or Instagram profile.
Still, the company is confronting significant regulatory pressures as the U.S. FTC and dozens of state attorneys general pursue antitrust lawsuits that seek to unwind its acquisitions of Instagram and WhatsApp.
Earlier this month, Facebook announced it is building a series of new audio-focused products to compete with social media rivals such as Twitter Inc. and popular upstart Clubhouse. The audio products would include virtual rooms where users can host live discussions, and a feature called Soundbites that lets users post short audio snippets to their feeds like they would a photo or video.
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