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Facebook Shares Drop On Revenue Miss (cnbc.com)

Posted by BeauHD on from the cause-and-effect dept.

Zorro shares a report from CNBC: Facebook missed projections on revenue and global daily active users this quarter after struggling with data leaks and fake news scandals. The company reported its second-quarter earnings after the bell on Wednesday. Shares were down as much as 10 percent. CNBC summarizes the results:

Earnings per share: $1.74 vs. $1.72 per a Thomson Reuters consensus estimate
Revenue: $13.23 billion vs. $13.36 billion per a Thomson Reuters consensus estimate
Global daily active users (DAUs): 1.47 billion vs. 1.49 billion, according to a StreetAccount and FactSet estimate
North American DAUs: 185 million vs. 185.4 million, according to a FactSet estimate
European DAUs: 279 million vs. 279.4 million, according to a FactSet estimate
Average revenue per user (ARPU): $5.97 vs. $5.95, according to a StreetAccount and FactSet estimate

9 of 69 comments (clear)

  1. Valoe by rossdee · · Score: 2

    "Earnings per share: $1.74 vs. $1.72 per a Thomson Reuters consensus"

    A one percemt drop im expected earnings causes a ten percent drop in share price? I thimkit was overpriced in the first place

    1. Re:Valoe by ClickOnThis · · Score: 2

      "Earnings per share: $1.74 vs. $1.72 per a Thomson Reuters consensus"

      A one percemt drop im expected earnings causes a ten percent drop in share price? I thimkit was overpriced in the first place

      Earnings actually beat the Thomson Reuters consensus. But that's just the consensus. Various analysts had estimates well above $1.74.

      In the current after-market, the stock price is starting to bounce up from around $164. Was the sell-off an over-reaction? Probably. Sooner or later, the stock will recover.

      And as for it being overpriced ... valuations can be weird, and the market can ignore them. Look at Tesla for example. There's no reason for its stock price to be above $300. Yet it is.

      --
      If it weren't for deadlines, nothing would be late.
  2. Seriously? by smithmc · · Score: 2

    Do I understand correctly that, in the quoted part of the posted story, the first number is the actual performance and the second one is the estimate? These numbers are essentially identical, i.e. FB hit its estimates almost precisely. So what's the problem, other than that investors are a bunch of histrionic idiots looking way too hard for something to get upset about?

    --
    Downmodding is the refuge of the weak. Don't downmod, make a better argument!
    1. Re:Seriously? by Quirkz · · Score: 2

      Stocks are weird. The daily report on the radio will talk about them being "up" or "down" but then often explain it's only a tiny fraction of a percent, sometimes even a single point, which in my mind ought to be "essentially unchanged."

      Sometime this week I heard "markets were mixed. The Dow was up $x, or roughly .8%. The NASDAQ was down one point." All I could think was, you really call that *mixed*?

      --
      The Quirkz Handbook of Self-Improvement for People Who Are Already Pretty Okay
    2. Re:Seriously? by drinkypoo · · Score: 2

      HF traders already have computers telling them this stuff. Hold a grudge much?

      Against HFT? Absolutely. HFT harms actual investors.

      --
      "You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
  3. Stuff that doesn't matter by ebcdic · · Score: 3, Interesting

    Can we stick to technical stuff please?

  4. Mark Zuckerberg's fortune tumbled by $16.8 billion by schwit1 · · Score: 2

    As of Thursday’s close, he will slide to sixth place from third on the Bloomberg Billionaires Index. That's tough.

  5. Irrational investors by OneHundredAndTen · · Score: 2

    As usual, investors acting irrationally and like a mob of sheep. No wonder we have market meltdowns every so often. FB remains of PoS though, so no sorrow here.

  6. Re:(((them))) by dromgodis · · Score: 2

    I have the same sentiment, but after having discussed it with people I have come to believe that it is not likely to work even if the trust issue was somehow resolved.

    Reason one is that it would require that close to all users pay for membership. The value as an advertising company is largely based on the sheer amount of eyeballs coupled with the massive amount of decent quality profiling information. If they lost that from 50% of their users, the ad value of the remaining 50% of the members would be less than 50%.

    Reason two, which is for the tinfoils among us, is that if they want to use the platform for other ends than to make ad money, e.g. to drive a political agenda or superintelligence takeover, then they would still need the profiling as input and could use the ad/"news" as a manipulation stream.