Facebook’s second-quarter net profit more than doubled compared to a year ago, but stock prices plunged on the prospect of slowing growth from the third quarter.
Facebook announced on the 28th (local time) that its sales in the second quarter increased 56% from $18.68 billion last year to $29.77 billion. The figure exceeds the Wall Street estimate of $27.81 billion.
Net profit stood at $10.394 billion, up 101 percent from $5.178 billion a year earlier. Net earnings per share also recorded $3.61 per share, exceeding market estimates (3.03 dollars).
This growth in performance was driven by increased advertising sales. Facebook’s second-quarter advertising sales increased 47 percent year-on-year. The number of ads delivered to about 3 billion subscribers increased by about 6%, and the average unit price also increased, leading to higher sales and net profit.
The number of monthly active users (MAU) and daily active users (DAU) stood at 2.91 billion in the second quarter, up 7 percent from the same period last year.
Facebook, however, predicted that sales growth will slow from the second half of this year. It is predicted that the reduction of target advertising sales following Apple’s restriction on data collection will begin in earnest and the expansion of vaccinations will lead to a break from the benefits of coronavirus 19.
“We expect sales growth in the third and fourth quarters of this year to slow significantly,” Facebook said in its performance data. “We expect the impact of advertising revenue from Apple’s updating of its mobile operating system to be reflected in earnest in the third quarter.” On the outlook, Facebook shares are down 3 percent in post-market trading.
Facebook is seeking to expand other revenue models such as online shopping and payment services in preparation for a hit in sales of targeted advertisements. In the same context, Facebook recently announced its vision to transform Facebook into a metabus company within the next five years by increasing investments related to augmented reality.
