Facebook wins big with mobile, posts $1.81B in Q2 revenue
The social network performed better than expected on both revenue and earnings per share. It also closed the quarter with 1.15 billion monthly active users.
Facebook on Wednesday reported second-quarter 2013 adjusted earnings of 19 cents per share on revenue of $1.81 billion, which is up 53 percent over the year ago quarter.
The report handily beat Wall Street's expectations of 14 cents per share on revenue of $1.62 billion, and the social network's stock spiked by 19 percent in after-hours trading.
Mobile, as predicted, turned out to be the company's greatest asset in the quarter, with revenue from the segment beating even the most bullish of estimates. Facebook said it made 41 percent of its $1.6 billion in advertising revenue, or $656 million, from mobile.
Advertising revenue, as a whole, accounted for 88 percent of total revenue and was up 61 percent from the same quarter last year. The social network's payments business, however, came in at just $214 million in Q2, which is mostly flat from the previous quarter and only an 11 percent improvement over the year ago quarter.
The social network said it grew monthly active users by 21 percent year over year to 1.15 billion people and daily active users by 27 percent to 699 million people in the quarter. Facebook also reported 819 mobile monthly active users and 219 million mobile-only active users.
"We've made good progress growing our community, deepening engagement and delivering strong financial results, especially on mobile," CEO Mark Zuckerberg said in a statement. "The work we've done to make mobile the best Facebook experience is showing good results and provides us with a solid foundation for the future."
Anticipation leading into Facebook's Wednesday report was focused on mobile as the protagonist that would save the social network's advertising business from flat or negative growth in desktop revenue. Analysts and investors were also curious to see if Facebook could continue to grow its user base and keep people coming back on a consistent basis.
So far, so good. Last quarter, Facebook's ratio of daily active users to monthly active users was 59.9 percent, a record high that quelled concerns around people losing interest in the social network. This quarter, the ratio improved slightly to 61 percent.
Facebook closed Wednesday up around 1.5 percent at $26.51 per share. Shares are rapidly picking up steam in after-hours trading.