Facebook Q1 Result Trounces Street, Shares Up 6%

(RTTNews) - Social networking giant Facebook Inc. (FB), Wednesday reported a surge in first-quarter profit, driven largely by a 52 percent jump in revenues. Both earnings and revenues trounced Wall Street estimates, sending shares up by 6 percent in the after-hours trading.

Menlo Park, California-based Facebook's first-quarter profit surged to $1.51 billion or $0.52 per share from $512 million or $0.18 per share last year.

Adjusted earnings for the quarter rose to $2.29 billion or $0.77 per share from $1.19 billion or $0.42 per share last year. On average, 41 analysts polled by Thomson Reuters estimated earnings of $0.62 per share for the quarter. Analysts' estimates typically exclude one-time items.

Revenues for the quarter surged to $5.38 billion from $3.54 billion last year. Analysts had a consensus revenue estimate of $5.26 billion for the quarter.

Daily active users rose 16 percent to 1.09 billion on average for March, while monthly active users increased 15 percent to 1.65 billion in March.

Mobile daily users gained about 24 percent to 989 million on average for March, while mobile monthly users increased 21 percent to 1.51 billion.

Revenues of Facebook, the world's most popular social networking site, continues to surge every quarter as companies and other firms continue to spend heavily to advertise on the social network

The rise of smartphone as been a boon for Facebook with mobile advertising revenues representing 82 percent of advertising revenue for the first quarter, up from 73 percent last year. Total advertising revenues surged 57 percent to $5.20 billion.

Total costs and expenses climbed 29 percent to $3.37 billion, as Facebook increased its spending on research and development as well as on marketing.

Further, Facebook announced its board has approved the proposal to create a new class of non-voting capital stock, known as the Class C shares. If the proposal is approved, shareholders will get two shares of Class C capital stock as a one-time stock dividend. This proposal is designed to create a capital structure that will allow Facebook CEO Mark Zuckerberg to sell some of his shares and to remain control of Facebook.

FB closed Wednesday's trading at $108.89, up $0.13 or 0.12%, on the Nasdaq. The stock further gained $7.03 or 6.46% in the after-hours trade.