Investors Having Mixed Sentiments As FB Prepares To Report Q2 Results
Facebook Inc (NASDAQ:FB) is up 2.39% as investors are having mixed sentiments before the Company reports its June quarterly results after going public for the first time.
Analysts are expecting the social network Company will post revenue growth of 28% only as compared to revenue growth of 45% reported in the March quarter. The Company’s facing a situation of higher usage but diminishing revenue from the mobile segment. Lao concerning is the factor that ARPU in the US and Europe is 7 times higher on average than ARPU elsewhere, and the mix of users is shifting to lower ARPU countries. Facebook also faces a weak Display Ad market in Europe accompanied by the Large Law impacting its MAU growth rate.
But on the other side of the coin there have been key monetization initiatives like the FB Exchange and the insertion of sponsored stories into mobile newsfeed. Other recent announcements include the Zynga rep deal and a Yahoo ad sales partnership.
Also, apart from this lower estimate for the second quarter analysts believe that the Company’s second half of the year might bring to a decent figure as there will be back-to-school, political, and holiday advertising as the main source of income.
Facebook has recently announced new advertising initiatives including Sponsored Stories on mobile news feeds; Promoted Posts; Ad Exchange; Ad Network; Simplified mobile payments for social games; Facebook to track user activities outside of Facebook to target ads; Facebook to track App usage to target mobile ads; Facebook to launch Job Board.
The street estimates Facebook to post earnings of $1.161 billion and proforma earnings of $0.12 per share.
First quarter revenue was $1.058 billion in the March 2012 quarter. Net income in the first quarter of fiscal 2012 was $205 million and $0.09 per diluted share. Included in the net income was share based compensation of $103 million.