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3 Key Predictions for Facebook's Q1 Earnings Report

Ryan McQueeney

As earnings season continues to trudge along, investors still have a few marquee releases to look forward to, including the first-quarter report of Facebook, Inc. FB, the world’s largest social media platform.

Facebook has revolutionized the way we interact with the internet, and from an investor’s perspective, it has done so while consistently delivering impressive growth and value to its shareholders. Now, as the world stands ready to enter the next stage in our digital transformation, Facebook stands poised to be a major leader.

Interestingly, Facebook seems acutely aware of the changing dynamics of our world, and the company is acting upon those changes now. Facebook has already warned investors that its growth rates will begin to face tougher year-over-year comparisons, but it has also said that this year will be one of aggressive investment in new employees and projects.

But what’s in store for Facebook this quarter? Well, our Zacks Consensus Estimates call for earnings of $0.88 per share and revenue of $7.85 billion. These results would represent year-over-year growth of 54% and 45.9%, respectively.

Of course, earnings and revenue are just two of the many things investors will be looking at when Facebook reports. Check out these three additional things to expect.

These important stock drivers are from our exclusive non-financial metrics consensus estimate file. These estimates are updated daily and are based on the independent research of expert stock analysts. Learn more here>>>

1.       Monthly active users will touch 1.9 billion

There’s a scene in the Facebook biopic The Social Network where the relatively-small company headquarters celebrates crossing the one million users threshold. Oh how the times have changed. Mark Zuckerberg and friends better have a nice bottle of champagne on hand for the 2 billion monthly active users (MAUs) celebration, because it’s coming soon. According to our consensus estimate, Facebook will report MAUs of about 1.9 billion this quarter—an increase of nearly 16% year-over-year. How’s that for consistent growth?

 

2.       Asia will be the fastest-growing market

Of course, Asia is an incredibly important market for nearly every company in the technology sector, but Facebook’s success in the region is on par with the best of them. Our consensus estimate calls for Facebook to hit 692 million MAUs in Asia this quarter, which would represent impressive quarter-over-quarter growth of 2.8% and year-over-year growth of 22.3%. This year-over-year growth figure would make Asia Facebook’s highest-growing market in terms of MAUs according to our consensus estimates.

 

3.       Average revenue per user will outpace user growth

In what has to be a good sign for investors that can see a user-growth plateau on the horizon, our consensus estimates currently call for average revenue per user (ARPU) to outpace user growth this quarter. In fact ARPU is expected to come in around $4.12, which would mark a 25.6% increase year-over-year. The fact that Facebook can continue to increase the amount it makes on each individual user is a great thing as other growth metrics may start to slow down.

 

Make sure to check back here for our full report once Facebook reports next week!

Want more stock market analysis from this author? Make sure to follow @Ryan_McQueeney on Twitter!

For coverage of the biggest tech earnings reports that have already been released, check out this week's Friday Finish Line podcast: 

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