Facebook Beats Q3 Revenue Estimates
Facebook had commented that it expects a tougher 2021 despite exceeding analyst expectations for quarterly revenue, thanks to the social media giant’s digital ad tools.
Facebook's total revenue, primarily consisting of ad sales, saw a 22% boost to $21.47 billion from $17.65 billion in Q3 ended September 30th, beating analyst estimates of a 12% rise. Net income, in turn, came in at $7.85 billion, or $2.71 per share, compared with $6.09 billion, or $2.12 per share a year earlier vs forecasts of $1.90 per share.
"Considering that online commerce is our largest ad vertical, a change in this trend could serve as a headwind to our 2021 ad revenue growth," the company commented.
Facebook’s CFO - Dave Wehner did, however, comment on an earnings conference call that expenses would rise due to the costs of work-from-home staff making their way back to the office, as well increased product investments and higher legal expenses. He commented that the company was expecting a margin decline as a result.
Facebook is currently under especially strong pressure ahead of US presidential elections, trying hard to avoid a repeat of 2016, when Russia managed to use its platforms to spread misinformation.
EMarketer principal analyst - Debra Aho Williamson said Facebook remains "a go-to for advertisers" despite its content moderation and privacy issues, but confirmed that it may well change in 2021.
"We expect that more advertisers will take a hard look at their reliance on Facebook and will ask themselves whether the environment is safe for their brands," she said.
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