Facebook earnings beat forecasts- with revenue climbing 61 percent. Bobbi Rebell reports.
Facebook's stellar results - putting a big smile on investors faces. The stock hitting record highs in after hours trading. Shares have nearly tripled over the last year. Earnings per share of 42 cents beating forecasts, as did revenues up a whopping 61 percent. The key metric: they are making more revenue per user says- S&P Capital IQ's Scott Kessler: SOUNDBITE: SCOTT KESSLER, DEPUTY GLOBAL HEAD OF EQUITY RESEARCH, S&P CAPITAL IQ (ENGLISH) SAYING: "There is really no other place online or in mobile context's, given the global reach, given just the sheer number of people and businesses and organizations on the platform, and then all the different things that people use Facebook for on a day-to-day basis. It really is so unique. And the reality is they are doing a very, very good job of delivering each and every quarter. It's clear that they have a focus, and they are executing against it." Facebook said that mobile advertising revenue represented 62 percent of its ad revenue in the second quarter, up from 41 percent a year ago. Facebook now has one and a half million advertising customers, and the ad business is seeing growth across all of its geographic regions. And their mobile users are growing as well- daily mobile users were up 39 percent. Facebook also has the resources to position itself for growth in younger demographics through acquisitions like Instagram and more recently WhatsApp and Oculus. SOUNDBITE: SCOTT KESSLER, DEPUTY GLOBAL HEAD OF EQUITY RESEARCH, S&P CAPITAL IQ (ENGLISH) SAYING: "They are able to do these types of deals in part because of the tremendous platform that they have built, the success that they have had, and frankly the ability to be able to look out not just a couple of quarters, but a number of years. So in terms of near term growth strategies, we absolutely look at Instagram, and then video. We think video advertising could come to the platform in mobile in a big way maybe before the end of the year." Kessler says that the numbers also prove that recent privacy controversies- including an academic study changing users' newsfeeds to study moods- haven't had any material impact.