Facebook’s Q1 numbers
Social media giant Facebook (FB) delivered revenues of ~$15.1 billion in the first quarter of 2019, which slightly beat analysts’ estimate of $15.0 billion. Facebook also delivered double-digit revenue growth of 26% on a YoY basis in Q1 2019, owing to an increase in the daily and monthly user base.
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Facebook’s sluggish growth in revenues
Despite posting double-digit growth in revenues for the past several quarters, revenue growth has fallen in the past four consecutive quarters due to softness in user growth due to privacy issues and other scandals. Facebook’s revenue growth rate has dropped from 49% in the first quarter of 2018 to 26% in Q1 2019. According to the company, the revenue growth rate will continue to fall in the second half of 2019.
The company gets most of its revenues from its advertising business. In Q1 2019, advertising revenues grew 26% YoY to $14.9 billion, but the growth rate fell from the preceding quarter’s advertising revenue growth of 29.9%. Facebook also earned $65 million from its payments and other fees in the first quarter, down ~4% from the prior-year quarter.
Revenue performance of peers
Facebook peer Twitter (TWTR) posted Q1 results on April 23, wherein it surpassed revenue estimates and exceeded the prior-year quarter’s revenues by 18%. Snap (SNAP) and eBay (EBAY) also beat estimates on revenues in the first quarter. The companies reported their results on April 23 after the market bell. While Snap’s revenues grew 39% YoY, eBay’s revenue growth was 2.4% in the quarter. PayPal (PYPL) reported in-line revenues in Q1 2019 on April 24 after the market closed. Its revenues grew 12% YoY.