When Facebook (FB) reports earnings on Wednesday, investors can expect to see yet another solid quarter, as the social media giant continues to gain momentum in mobile advertising and focuses on its video efforts.
Wall Street is anticipating $0.97 of earnings per share on $6.9 billion of revenue, according to Factset. Facebook is scheduled to report third-quarter earnings on Wednesday after the markets close.
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The market will want to see overall revenue -- particularly advertising revenue -- increase, said Tigress Financial Partners analyst Ivan Feinseth by phone.
Growing ad revenue "continues to verify Facebook's relevance and importance and the fact that the economy is strong because advertisers are spending money on advertising," Feinseth added.
Improving user engagement, too, will quell concerns among some investors about whether Facebook is starting to lose its relevance and/or if users are spending less time on it, he said, noting that video is Facebook's "next big thing" that the social media company will want to demonstrate results for.
"Facebook is a great, innovative company," Feinseth said, reiterating that the social media company has been built on a series of bold moves by co-founder, chairman and CEO Mark Zuckerberg. "I want to hear new interesting initiatives."
At Menlo Park, Calif.-based Facebook, virtual reality and artificial intelligence will likely continue to be introduced toe the platform, since they represent unique ways for users to share experiences.
Wedbush Securities analyst Michael Pachter expects Facebook to deliver a solid beat on Wednesday thanks to its strength in mobile advertising.
"Facebook has a virtually insurmountable competitive advantage with over 1.7 billion monthly active users and over 1.1 billion daily active users, and has succeeded in convincing 3 million advertisers that its captive audience will yield returns on advertising investment," he noted in an Oct. 27 note.
The social media giant will likely continue investing overseas and searching for ways to further monetize Instagram, WhatsApp and Messenger, Pachter wrote, adding that Facebook is approaching full penetration in North America and Europe but will continue to enjoy growth in Asia and rest of the world.
Facebook has certainly had a busy year. Just last month, for instance, it rolled out Marketplace -- an exchange for users to sell and buy products in their respective communities, as it gears up to compete more directly against Amazon.com (AMZN) and eBay (EBAY) in the already competitive e-commerce market.
While its social media rivals such as Twitter (TWTR) continue struggling with stagnant user growth and difficult monetization, Facebook has enjoyed a stellar ride and continues to extend its dominance.
Other investment areas of "greenfield opportunities" include video advertising, Instagram monetization, messaging platforms and virtual reality, RBC Capital Markets analyst Mark Mahaney also wrote in a Monday note.
"If there's One Big New Theme here, it's the Video-ification Of The Internet," Mahaney wrote. "FB is extremely well positioned for this."
Shares of Facebook are down about 0.3% Wednesday morning to $129.13. Its stock is up about 23% year-to-date.