Research archive for META

Last week Facebook released Q1 results which comfortably beat expectations. Revenues grew by 18% versus this time last year. Expectations were for 13% growth. As we have spoken about before, Facebook user engagement should increase nicely during the global shutdown but advertising spend will drop. Advertising is 98.3% of all their revenues.

What about Facebook? How is it doing on planet Covid-19? There are currently 311 Vestact clients who own Facebook shares in their New York portfolios. The aggregate value of those holding is $10 207 448.

I think that Facebook's Libra will be a game changer for the international payments space, and by extension entrench the Facebook platform in all or our lives. The first step though is to stop calling it Facebook's cryptocurrency. In reality, Facebook initiated the concept but when it comes to control of the new currency, they don't have any more say than other member companies.

The worlds most popular messaging app, WhatsApp revealed how massive it has become since starting 11 years ago. The Facebook owned app hit 2 billion users, up from 1.5 billion 2 years ago. The mother company Facebook, which recently hit 2.5 billion users, is the only other platform with over 2 billion users.

Facebook reported its Q4 results last night, and they were in line with expectations. Revenue was up 25% compared to the same period last year. Earnings per share were $2.56 which was modestly above consensus at $2.53. In the absence of much to cheer about the stock price fell in after-hours trade, by 7%.

The Wall Street Journal is reporting today that Facebook management has decided to avoid putting ads on WhatsApp. That's great news for all of us using the service (more than 1.5 billion people around the world).

More and more people I talk to are doing business on Whatsapp. Our very own Vestact Superheroes group is very active, especially when we are not all in the office at the same time. I also find myself chatting to clients a lot more on WhatsApp. It really is a convenient method of communication.

On Wednesday night Facebook reported quarterly numbers that were ahead of analyst expectations. The company had revenues of $17.7 billion which allowed them to generate a profit of $6 billion. Just to put that in Rand terms, they make R90 billion in profits every three months, or R30 billion every month. Discovery's market cap is R80 billion, that means Facebook could buy Discovery with one quarter's worth of profits. The key to the Facebook business model is the number of people using the platform. The graph below shows how their monthly active users (MAU), has continued to grow. They added around 200 million people to the platform over the last 12 months.

This sounds futuristic but the headline is true. Facebook agrees to acquire brain-computing start-up CTRL-labs. And the company is not coming for free, it will cost between $500 million and $1bn. Remember, $1bn is what they paid for Instagram.

A big part of the Facebook stable is WhatsApp, where the company has yet to unlock the applications full potential. Getting the user base was the first challenge, now they need to figure out a way to monetise without reducing user experience. The huge potential for growth from WhatsApp is one of the reasons why we own Facebook shares.

The Wall Street Journal reported late on Friday that the Federal Trade Commission (FTC) has agreed to fine Facebook a record-setting $5 billion on Friday for privacy violations. This makes me mad.

Yesterday Facebook released details of their new cryptocurrency, Libra. The currency is only partly Facebook's because there are other founding partners, who also have a say in how things will be run. The founder group includes Visa, Mastercard, Uber, PayPal, Vodafone, PayU (Naspers) and eBay. It's expected to launch early next year.

I'm getting really steamed up about bullsh*t articles in the media suggesting that Facebook should be split up. I mean, what tripe is this? They are a private company, offering a free service on the Internet, to which users sign up voluntarily! Ok, they have made a few mistakes with sharing data with advertisers and other "marketers", but they said that they'd be more careful in future. Never forget, individual users get to determine their own privacy settings.

Last week Tuesday was a big day for Facebook. They had their annual developer conference during a time where the company's potential negative influence on society is the main focus. You may have noticed already that the newsfeed has been redesigned. The design encourages more sharing within the private realms of Messenger and Whatsapp.

On Wednesday evening Facebook released Q1 numbers. The stock popped 9% in after-hours trade and closed the day out up 6%.