The social network beat earnings estimates but missed on revenues, the first time it's missed quarterly sales estimates since 2015. Facebook reported revenues of $13.23 billion vs. expectations of $13.34 billion, while GAAP EPS of $1.74 topped estimates of $1.71.
More significantly, though, company executives on the earnings call guided for revenue growth to drop by a high-single digit % sequentially in both Q3 and Q4, and for the company's operating margin, which was at 50% in 2017, to eventually trend to the mid-30s.
Shares were initially down about 9% after hours following the report's release, but the losses accelerated as the company's earnings call proceeded.
Shares plunged 17% in pre-market trading Thursday.
TheStreet's tech columnist, Eric Jhonsa, and Jeff Marks and Zev Fima, analysts with Jim Cramer's Action Alerts Plus portfolio, which owns Facebook, live blogged the company's earnings report and call with analysts.