Facebook Boosts Revenue by 32 Percent in First Public Financial Report

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Facebook boosted revenue by 32 percent in its first earnings report as a public company, bringing in US$1.18 billion and topping analysts' expectations slightly.

The company blamed its net loss of $157 million for the quarter that ended June 30 on the fact that after its IPO, it recognized $1.3 billion of share-based compensation and related payroll tax expenses. Facebook had a $240 million profit in the same quarter of last year.

Analysts polled by Thomson/First Call expected $1.15 billion in revenue. Adjusted for one-time expenses, earnings per share were in line with analysts' expectations at US$0.12. Those earnings are based on an adjusted net income figure of $295 million, slightly increased from adjusted net income of $285 million in the same quarter of 2011.

As expected, mobile users were the growth highlight for the company, increasing 67 percent year-over-year to 543 million as of June 30. Monthly active users were up 29 percent to 955 million, while daily active users were up 32 percent to 552 million on average.

'Disappointed' But Looking Forward

"We're disappointed at the way the stock has traded, but it's important for us to remember that we're the same company now we were before, and we've got the same opportunities ahead," Facebook's chief financial officer, David Ebersman said in the company's earnings call.

Advertising revenue accounted for 84 percent of the total take at $992 million, up 28 percent year over year. Payments and other fees revenue were $192 million in the quarter.

Mark Zuckerberg

Facebook said its mobile advertising efforts saw some progress during the quarter, and CEO Mark Zuckerberg suggested that Facebook will not try to build its own smartrphone, as some rumors have suggested.

But the company expects to continue the rapid pace of acquisitions it has maintained since it went public.

"Our strategy has been primarily to buy companies for talent," Zuckerberg said.

Facebook now has 4000 employees, up by half what it had a year ago, and $10.2 billion in cash and investments on its balance sheet.

Cameron Scott covers search, web services and privacy for The IDG News Service. Follow Cameron on Twitter at CScott_IDG.

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