Facebook shares surged 6% after the company released its first quarter 2021 financials, well above Wall Street’s expectations.
Facebook (FB) posted strong first three months of 2021 on Wednesday after the market closed as its ad revenue surged as economies recovered amid massive COVID-19 vaccinations and the lifting of quarantine restrictions.
Facebook’s efforts in digital selling tools have also paid off, as sellers use Facebook, Instagram, WhatsApp and Messenger as tools to communicate with customers.
“We will continue to invest heavily in delivering new and meaningful experiences for years to come, including in new areas such as augmented and virtual reality, commerce and the ‘economy’ for content creators,” said Facebook founder and CEO Mark Zuckerberg, commenting on report.
Facebook’s first-quarter earnings jumped 93% to $ 3.30 per share, a whopping $ 0.93 better than the analyst average of $ 2.37. Quarterly profit rose to $ 9.50 billion from $ 4.9 billion a year earlier.
Revenue grew 47.5% to $ 26.17 billion, which is also higher than Wall Street’s estimate of $ 23.67 billion. Facebook’s quarterly revenue and earnings statistics for the last 2 years are available here.
Facebook executives said “strong ad revenue growth was driven by a 30% increase in average CPA over the same period last year and a 12% increase in ad serving.”
Facebook’s user base demonstrates low but steady growth rates consistently from quarter to quarter. At the end of March 2021, active Facebook users averaged:
Daily Active Users (DAU): 1.88 billion, up 8% from last year.
monthly (MAU): 2.85 billion, up 10% from the same period last year.
The company said: “We expect cumulative revenue growth to remain stable in the second quarter of 2021 or accelerate slightly compared to the growth rate in the first quarter of 2021.
We continue to expect 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, which we expect to begin impacting in the second quarter. ”