Facebook stock tanked 7 percent after releasing Q4 Earnings

 Facebook reported its earnings after the hours on January 29, 2020, and the stock plummeted right after the report came out. Although Facebook had a good business model, it struggled to impress investors and the stock dropped heavily due to possible regulations that may hurt Facebook’s business.

Facebook Q 4 earnings data 

 Facebook reported Earnings (EPS) of $2.56 vs. $2.53 per share forecast by Refinitiv.

·       It’s Revenue came in at $21.08 billion vs. $20.89 billion forecast by Refinitiv.

·       Daily active users (DAUs) came in at 1.66 billion vs. 1.65 billion forecast by FactSet.

·       And monthly active users (DAUs): 2.5 billion vs. 2.5 billion forecast by FactSet.

·       Also, the average revenue per user (ARPU): $8.52 vs. $8.38 forecast by FactSet.

The company reported that its cost and expenses for the year 2019 went up by 51 percent to $46.71 B when compared to 2018 cost and expenses numbers.

According to the data released during the report, Facebook reported revenue growth of about  24.7% compared to a year prior, making it the fourth straight quarter that the company delivered sub-30% growth.

 

Points for investors to pay attention to -

The company stated that it would buy back about $10 billion shares in its stock repurchase program.

Facebook did well on the business side but the stock went down due to the possible regulations that may affect them. As a result, the stock was down 7 percent from $223 to $ 209.53 -13.70 (-6.14%)

 According to the company “This was a good quarter for our community and our business, and a strong end to the year. There are

now around 2.9 billion people using Facebook, Instagram, WhatsApp or Messenger each month, and

around 2.3 billion people using at least one of our services daily. There are now more than 140 million

small businesses that use our services to grow -- the vast majority of which use our services for free”.

• Q4 total revenue was $21.1 billion, up 25% or 26%
• Q4 total ad revenue was $20.7 billion, up 25% or 26%
• FB grew 33% and 28%, respectively. Europe and US & Canada grew more slowly at 24% and 22%,
• respectively.
• Total expenses were $12.2 billion in Q4, up 34%.
• Operating income was $8.9 billion