Great quarter, shares up about 7% in AH trading. From the earnings release:
“Despite facing important challenges, our community and business are off to a strong start in 2018,” said Mark Zuckerberg, Facebook founder and CEO. “We are taking a broader view of our responsibility and investing to make sure our services are used for good. But we also need to keep building new tools to help people connect, strengthen our communities, and bring the world closer together.”
See the entire release at https://s21.q4cdn.com/399680738/files/doc_financials/2018/Q1…
Here’s more from MarketWatch:
Facebook added 70 million users in the first quarter, meeting user-growth expectations despite public calls to delete the social-media app. The company now boasts 1.45 billion daily users and 2.2 billion monthly members. The company’s operating expenses came in below consensus expectations, though Zuckerberg has warned they will continue to eat into Facebook’s profits as it adds 20,000 workers to address security and privacy concerns.
According to the earnings release, Facebook increased its workforce by 48% to 27,742, compared with the year-earlier quarter.
Chief Financial Officer David Wehner broke down a portion of those security and safety costs, telling analysts that the sales and marketing expense growth of 51% compared with the year-earlier quarter was driven by the “community operations investment.” That unit includes some of the money the company is spending on quality and safety initiatives, and Wehner expects the spending to “carry through the year.”
Here’s a look at some awfully nice numbers:
Revenue (billions) Q1 Q2 Q3 Q4 2013 1.458 1.813 2.016 2.585 2014 2.502 2.910 3.203 3.851 2015 3.543 4.042 4.501 5.841 2016 5.382 6.436 7.011 8.809 2017 8.032 9.321 10.328 12.78 2018 11.97 EPS (Diluted) Q1 Q2 Q3 Q4 2014 0.30 0.25 2015 0.18 0.25 0.31 0.54 2016 0.60 0.78 0.90 1.21 2017 1.04 1.32 1.59 2.21* 2018 1.69
2018 Q1 Earnings (Current):
Revenue Growth (billions)
2017 Q1 TTM Revenue = 30.29
2018 Q1 TTM Revenue = 44.40
YOY TTM Revenue Growth =46.6%, previous quarter 46.4%
EPS Growth (Diluted)
2017 Q1 TTM Earnings = 3.93
2018 Q1 TTM Earnings = 6.81
YOY TTM EPS Growth = 73.3%, previous quarter 76.5%
P/E (Check Current Price) = 159.69/6.81 = 23.45
Trailing 1YPEG = 23.45/73.3 = 0.32
Here are some of the other quarter’s highlights:
DAUs (daily active users): 1.45B, +13% YOY
MAUs (monthly active users): 2.2B, +13% YOY
Cash and cash equivalents: $43.96B, previous quarter $41.71B, +5.4% sequentially
Cap Ex: $2.81B, previous quarter $2.26B, up 24.3% sequentially
Mobile advertising revenue: Made up 91% of all revenue, up from 85% in prior year’s quarter
Head count: 27,742 48% increase YOY
Yeah, yeah, I know we’re all mad at them. I suspended my Facebook account back in 2012 because I thought it was a colossal waste of time and because of the privacy thing. But I’m not selling shares with numbers like these. I have college accounts and retirement funds that need to grow. That’s my first priority.
Is there risk here? Absolutely! Regulation and record lawsuits could be just around the corner. But that’s why the price is so darned low. But what’s that Buffett (Munger?) saying? You pay a pretty price for a rosy outlook. Something like that. By my way of thinking, a lot of bad news is priced in right now. I think shares are a bargain. This is my top allocation right now and I’m tempted to buy even more.
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