Facebook reports huge quarterly growth

By Barry Eitel

SAN FRANCISCO (AA) – Facebook beat analyst expectations Wednesday with a third quarter earnings report that showed the company earned $7 billion in revenues.

That revenue was earned from the company’s 1.79 billion monthly active users, a 16 percent increase compared to the same period last year. To put it in perspective, as of the three months ending Sept. 30, Facebook has a larger population than China and the United States combined. The number of users easily blows away any other social network, and 1.18 billion people log into Facebook every single day.

"We had another good quarter," founder and CEO Mark Zuckerberg said in a statement. "We're making progress putting video first across our apps and executing our 10 year technology roadmap."

During the earnings call, Zuckerberg touted how involved users have been with the current U.S. elections. According to Facebook, 109 million people have generated 5.3 billion posts, comments and Likes related to the election since January. Facebook recently launched a voter registration service, and about 2 million people have since registered.

The report beat analyst expectations, which predicted quarterly earnings of $6.92 billion in revenue. Shares of Facebook hit an all-time high of $133.50 in late October, although shares drifted down to $127.17 at the close of markets Wednesday. In after-hour trading during the earnings call, shares fell even further to $124.98, a drop of nearly 6 percent.

The slippage could have been caused by Facebook Chief Financial Officer Sheryl Sandberg relating that revenue growth is expected to slow in the final quarter of 2016. Another issue that seemed to worry investors is that Facebook is changing the way its employees pay taxes on stock awards. Previously, employees paid that tax, but now Facebook will pick up the tab, which could cost more than $1 billion per year.