Facebook adds 1 million daily users in the U.S. and Canada despite constant controversy
Facebook Inc. reported record profits — about $1 billion more than any previous quarter — as the company beat Wall Street expectations for fourth-quarter earnings and revenue late Wednesday.
Facebook stock FB, +4.32% rose more than 12% in after-hours trading as the company conducted a conference call.
The Menlo Park, Calif.-based company reported $6.88 billion in net income for the fourth quarter, which amounts to $2.38 a share, up from $1.44 a share in the year-ago period. Analysts’ average estimates for fourth-quarter profits called for $2.18 a share, according to FactSet.
Overall, Facebook logged sales of $16.91 billion, up from $12.97 billion in the year-ago period, beating Wall Street expectations for sales of $16.39 billion, according to FactSet. Facebook’s main source of revenue is ads, which brought in 93% of revenue, up from 89% in the year-earlier period. Facebook’s payments and other fees category — which includes its Oculus virtual-reality hardware — banked $274 million compared with $193 million last year.
After several quarters of declining or flat user growth in Canada and the U.S., Facebook said it added 1 million daily members in those territories. Daily membership grew in Europe as well, to 282 million from 277 million in the year-ago quarter.
Monthly active users in the U.S. and Canada remained flat at 242 million compared with the third quarter, though rose from 239 million in the year-ago period. Facebook said its European monthly users grew to 381 million from 370 million in last year’s fourth quarter.
“Our community and business continue to grow,” Facebook Chief Executive Mark Zuckerberg said in a statement. “We’ve fundamentally changed how we run our company to focus on the biggest social issues, and we’re investing more to build new and inspiring ways for people to connect.”
The U.S. and Canada are Facebook’s most lucrative territories, and on average users were worth $34.86 each, compared with $26.76 in the same period last year; in Europe, Facebook made an average of $10.98 per user. Worldwide average revenue per user grew to $7.37.
“With these results, Facebook has clearly demonstrated that the challenges of 2018 have not had a lasting impact on its ability to increase both revenues and usage,” eMarketer analyst Debra Williamson said via email. “Advertisers are clearly still very reliant on Facebook, and the fact that daily active usage in both the U.S. [and] Canada and Europe increased is a surprise after the flatness we saw in the U.S. and Canada last year and the falloff we saw in Europe.”
Before Wednesday’s results, Facebook stock had fallen 20% in the past year, while the S&P 500 index SPX, +1.55% has fallen 6.6%. Facebook stock rose 4.3% to $150.42 during Wednesday’s regular session.