Facebook has announced third quarter earnings, and they beat what Wall Street was expecting. Analysts were looking for 11 cents a share and they got 12. Jump back! That penny is adjusted to a 2-cent loss once proper accounting protocols are followed. But a beat is indeed a beat. And as you can see in the first chart in the slide show above, Facebook lost less - on a GAAP-adjusted basis, a lot less - than it did last quarter.
The next chart is even more interesting. As you can see, Facebook has acquired a billion users worldwide (not all of them active, however) with a headcount of just 4,331 employees. If you divide Facebook's quarterly revenue of $1.26 billion by total users, you get a per-user worth of $1.26.
Viewed another way, every employee at Facebook is worth 230,894 users — or $290,926 in revenue. Now, you could argue that a lot of Facebook employees are costing the company more than $291,926, because they're getting stock. But you also have to consider that although Facebook pays its well, not that many of them make nearly $300,000 per quarter, or $1.2 million per year.
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Facebook will report earnings for the first time ever tomorrow.
It's not the IPO big day, which turned out to be a total FAIL! day. Rather, it's Facebook's first quarterly earnings report as a public company, due to arrive tomorrow.
Though there’s a lot riding on its second-quarter earnings report — Wall Street analysts aren’t expecting big surprises. Why? Facebook effectively warned investors before its IPO that Wall Street’s expectations were too high. In a filing issued a week before its IPO, Facebook said its mobile users are growing at a faster pace than the number of ads on its mobile platform.
As a result of that disclosure and others, many analysts reduced their estimates for Facebook’s projected revenue and earnings.
On average, analysts are expecting Facebook to post earnings of 12 cents per share on revenue of $1.16 billion, according to a poll by FactSet. In all of 2011, it had net income of $1 billion and revenue of $3.71 billion, according to regulatory filings.
Blast off! Hawthorne-based SpaceX has had a very good week.
Last week, I wrote about how two California companies — Facebook and SpaceX — were experiencing big events. Facebook of course was staging its long anticipated IPO, immediately after which its CEO staged his own private big event, a marriage to longtime girlfriend Priscilla Chan. SpaceX was expected to launch the first mission by a private company to service the International Space Station. That didn't happen over the weekend, but it took place on Tuesday. SpaceX's CEO has been married twice already, so celebratory nuptials weren't on his agenda.
Of the two big events, you'd have expected Facebook's IPO to be more-or-less hassle-free, as it minted numerous billionaires and millionaires. Meanwhile, SpaceX was shooting rockets into space. Millions of things could have gone wrong.
The way things actually turned out is a study in contrast. Astonishing contrast.
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The Facebook IPO now seems so long ago, now that everyone is complaining about how it was screwed up.
I'm resting up a bit this week and spending some quality time with what I think could be the next big social-media site, Quora. Head on over there and watch me answer some questions. And watch other Quorians do it, too.
But I do need to update everyone on the Facebook IPO mess. And it's a very big mess. You can read the Wall Street Journal's blow-by-blow here, or jump over to Business Insider and read Henry Blodget all but accuse Facebook CFO David Ebersman of violating SEC rules (which is ironic, given that Blodget himself is banned for life from the securities business for breaking the rules). At Reuters, Felix Salmon offers his own analysis — also laying much blame on Ebersman, but pointing to Morgan Stanley lead technology banker Michael Grimes as someone who botched his job.
Circumstantially, it seems what happened — apart from the computer screw-ups by NASDAQ that delayed trading on Friday — is that several of the major banks involved in the Facebook IPO, such as Morgan Stanley, Goldman Sachs and JP Morgan, cut their estimates for Facebook's second-quarter and full 2012 financial performance during the IPO "road show." They were motivated by Ebersman allegedly conveying information to them, as well as by an amended IPO filing with the SEC.