Facebook Inc. (FB) - Get Facebook, Inc. Class A Report posted stronger-than-expected second quarter earnings Wednesday but noted that ad revenue growth would slow "significantly" over the second half of the year.
Facebook said profits for the three months ending in June were pegged at $3.61, up 100% from the same period last year and 55 cents ahead of the Street consensus forecast of $3.04 per share.
Group revenues, Facebook said, rose 55.6% to $29.077 billion, again topping analysts' estimates of a $27.87 billion tally. Advertising revenues, Facebook said, came in at $28.58 billion.
Looking into the final half of the year, Facebook repeated its view that year-over-year total revenue growth will decelerate 'significantly' when compared to the second quarter.
"We had a strong quarter as we continue to help businesses grow and people stay connected," said CEO Mark Zuckerberg. "I'm excited to see our major initiatives around creators and community, commerce, and building the next computing platform coming together to start to bring the vision of the metaverse to life."
Facebook shares were marked 3.9% lower in extended-hours trading immediately following the earnings release to indicate an opening bell price of $358.40, a move that would still leave the stock with a year-to-date gain of 31.2%.
Daily active users averaged 1.91 billion over the quarter, up 6.7% from last year, while monthly active users rose 7.4% to 2.9 million.
Advertisers, eager to reach consumers that spend less time travelling amid work-from-home shifts triggered by the coronavirus pandemic, have been spending billions online in order to showcase goods and services to buyers flush with stimulus cash and wage increases.
Google parent Alphabet (GOOGL) - Get Alphabet Inc. Class A Report also posted impressive ad revenue gains over the three months ending in June, with sales up 70% to $50.44 billion. YouTube ad revenues, in fact, surged 83% to just over $7 billion.
Facebook's upstart social media rival, Snap Inc. (SNAP) - Get Snap, Inc. Class A Report, reported a 116% surge in topline revenues last week, which came in at $982 million, thanks to a boost in daily active users and its investment in video advertising channels.
Looking into the current quarter, Snap said it sees revenues of between $1.07 billion and $1.09 billion, with daily active users topping 300 million by the end of September.