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How Facebook Performed in 1Q18



Facebook beats expectations in 1Q18

Social media giant Facebook (FB) impressed investors with its robust 1Q18 results, despite business challenges. The company reported earnings and revenue well above analysts’ estimates, delivering double-digit growth YoY (year-over-year). Facebook stock closed flat at $159.69 on April 25.

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Facebook’s 1Q18 numbers

Facebook generated revenue of ~$12.0 billion in 1Q18, beating analysts’ estimate of $11.4 billion. Its adjusted EPS (earnings per share) of $1.69 also exceeded analysts’ estimate of $1.35. Its revenue and earnings rose 49% YoY and 63% YoY from $8.0 billion and $1.04, respectively.

Facebook had 1.5 billion daily active users and 2.2 billion monthly active users in 1Q18, as expected by analysts. Facebook’s daily user base rebounded despite the recent Cambridge Analytica scandal, which raised doubts over the company’s data privacy policies.

According to an NBC report on April 18, Facebook users’ confidence in the company fell 66% after the data breach issue, which impacted more than 87 million users’ private information. As the data leak issue also impacted 2.7 million Europeans’ personal data, the European Union is planning to change privacy regulations in Europe. These new regulations could impact Facebook’s daily and monthly user count in the next quarter, as well as Twitter (TWTR) and Google (GOOGL), which generate most of their revenue from advertisements and use a massive amount of personal data to target ads.


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