Facebook blows past forecasts, but warns that growth will “slow down” in the second half of the year

Facebook Inc. it is the latest technology giant to achieve an increase in digital advertising, but the worrying orientations of the second half of the year caused its shares to initially fall by 5% in the extended trading period.

The social media giant FB,
+ 1.49%,
which relies almost exclusively on advertising, it said it earned $ 10.39 million, or $ 3.61 per share, beating forecasts of $ 3.04 per share, according to analysts surveyed by FactSet. Facebook sales catapulted 56% to $ 29.08 million, surpassing estimates of $ 27.85 million.

“In the third and fourth quarters of 2021, we expect total year-on-year revenue growth rates to slow significantly significantly sequentially as we go through periods of increasingly strong growth,” said Facebook Chief Financial Officer David Wehner. in a statement announcing results. “We continue to expect an increase in ad targeting in 2021 from regulatory and platform changes, particularly recent iOS updates, which we expect will have a greater impact in the third quarter compared to the second quarter “.

Monthly active users, a key barometer of Facebook’s global growth, improved 7% to 2.9 billion, in line with expectations of 2.91 billion. However, daily active users in the United States and Canada remained flat.

Facebook, such as Google Alphabet Inc. GOOGL,
+ 3.18%

GOOG,
-0.30%,
Twitter Inc. TWTR,
+ 2.39%,
and Snap Inc. SNAP,
+ 2.96%
before, it benefited greatly from a wave of online advertising, as smaller businesses use social media and seek to reach consumers during the pandemic.

At the same time, non-advertising revenue from e-commerce and AR / VR continued to grow, rising 36% to $ 497 million. In a recent interview with The Verge, Zuckerberg called augmented and virtual reality as close frontiers in a search that for years its billions of users have been communicating, buying, and selling products.

“We’re expecting a super bounce from the ad, but more importantly, we’re seeing the impact of IDFA [Apple Inc.’s
AAPL,
-1.22%
Identifier for Advertisers] the second half of the year and whether Facebook can evolve the user experience through virtual reality, ”Dan Flax, senior research analyst at investment firm Neuberger Berman told MarketWatch before the earnings announcement. “Facebook should also explain to regulators how the data is used.”

Facebook’s advertising hype comes a day after Google reported record revenue of $ 61.9 billion and $ 18.5 billion in revenue.

Read more: The wave of digital ad sales from Google helps it crush revenue and earnings estimates

What makes the results even more open (or, conversely, demonstrates the point of federal regulators) is that Facebook, Alphabet, and Apple Inc. they offer outrageous figures despite increased antitrust control by the Department of Justice, the Federal Trade Commission, state attorneys general, attorneys general, and consumer rights organizations.

Facebook shares have risen 37% so far this year, while the broader S&P 500 SPX index,
-0.02%
has gained 17% in 2021.

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