Social media giant Facebook (FB) reported earnings and revenue that beat expectations on Wednesday but its operating margin fell sharply.
FB)After the earnings announcement, the company's shares wavered at levels close to their finish. (Click here to get the latest quotes for Facebook:
During the fourth quarter, net income fell sharply to $64 million from $302 million in the year-ago quarter.
Excluding share-based compensation and related payroll tax expenses, and income tax adjustments, Facebook's profit was $426 million, or 17 cents per share, compared to $360 million for the same quarter in the prior year.
Revenue increased to $1.59 billion from the $1.13 billion a year ago it reported in its regulatory filings with the U.S. Securities and Exchange Commission before the company's initial public offering in May 2012.
Facebook's operating margin shrunk to 33 percent on a GAAP basis in the fourth quarter, compared to 48 percent a year ago.
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Facebook said its mobile monthly active users jumped 57 percent to 680 million as of December 31, 2012. For the first time, the company said its mobile daily active users exceeded web daily active users.
During the quarter, mobile revenue, a closely watched figure, represented approximately 23 percent of advertising revenue, up from about 14 percent of advertising revenue in the third quarter of 2012
Facebook has ramped up its online advertising services in recent months, putting a greater emphasis on mobile ads and introducing capabilities that let marketers target Facebook users based on their Web browsing history.
In recent months, Facebook stock has rebounded, surging more than 75 percent from its all-time lows due in part to increased investor optimism about the company's ability to monetize its mobile user base. Despite the sharp uptick, shares are still trading below the company's IPO price of $38.
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