Facebook Faces Wall Street

NEW YORK (TheStreet) -- Facebook (FB) reports its second-quarter results after market close, with all eyes on the company's mobile initiatives and investors eager to see whether social networking's around for the long haul.

Facebook has had its share of missteps in recent months, most notably its disastrous IPO in May. However, the largest issue facing the company is whether it can generate meaningful revenue from its mobile platforms, as more users gravitate towards smartphones and tablets.

Piper Jaffray analyst Gene Munster notes that mobile is a "wild card" for the second-quarter, as the company has just begun to monetize its 488 million mobile users, as of March 2012.

"During the Q2 earnings call, we believe management will likely be asked about the company's new mobile ad units," Munster wrote. "We note that, according to TBG Digital, clickthrough rates (CTRs) on ads in Facebook's mobile newsfeed are almost 2x as high as on the desktop newsfeed, thus early indications appear positive." He rates Facebook "overweight" with a $41 price target.

JPMorgan analyst Doug Anmuth is looking for an in-line quarter, as first-quarter issues hampering growth appear to have extended into the second quarter.

"We expect continued deceleration in revenue growth to be driven by the rapid shift in usage towards mobile as Facebook has specifically highlighted the trend of DAUs (daily active users) increasing more rapidly than the growth in ads delivered, with mobile cited as a primary factor," Anmuth wrote in his note. "In addition, we expect Facebook to see some softness in Europe and the mix shift of ads moving more toward geographies with lower pricing such as Asia and ROW (the rest of the world)."

The analyst is looking for earnings of 11 cents a share on $1.105 billion in revenue. Anmuth rates shares "overweight" with a $45 price target.

Zynga's (ZNGA) second-quarter earnings miss on Wednesday has also raised questions about Facebook's earnings report. The online gamer cut its full-year earnings guidance, citing "a more challenging environment on the Facebook web platform." It also mentioned delays in launching new games, and reduced expectations for Draw Something.

TheStreet will be live-blogging Facebook's results at 3.45 PM ET:

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