Facebook beats Street; shares soar

SAN FRANCISCO — Facebook beat Wall Street's fourth-quarter sales and profit forecasts, driven by advances in mobile advertising.

The company also provided evidence that the world's largest social network is still growing, and the percentage of monthly users who log in daily is up slightly, at 62%, compared with 59% a year ago.

"Last quarter was our first quarter where more than 50% of our revenue came from mobile," CEO Mark Zuckerberg said on a conference call.

The social-networking giant reported net income of $780 million on $2.6 billion in revenue in the quarter. Analysts had projected Facebook would report fourth-quarter net income of $703.5 million on $2.3 billion in revenue, according to the survey of estimates from Thomson Reuters

Excluding expenses, Facebook was expected to earn 27 cents per share. On that basis, Facebook reported 31 cents per share.

Shares of Facebook surged 12% to $60.04 in after-hours trading on the news.

Revenue from advertising was up 76% from last year, at $2.34 billion. Payments revenue in the quarter was $241 million.

Monthly active users hit 1.23 billion, up 16% from a year ago.

"The percentage of monthly users who log in daily continues to improve," says Edward Jones analyst Josh Olson.

Facebook has come under the spotlight for teen defections. CFO David Ebersman disclosed on the company's third-quarter earnings call that teens using Facebook declined slightly, triggering anew worries about Facebook's popularity.

Teens are flocking to Instagram, which Facebook purchased for $1 billion, and Snapchat, which the social network offered to buy for $3 billion, but the offer was declined.

On teens, "we don't have any new data to report today," Ebersman said on the earnings conference call.

Teen concerns were amplified by a report in January from iStrategyLabs saying Facebook's U.S. teenage members have plummeted 25.3% in the past three years.

Facebook's mobile usage continues to surge. Mobile mont! hly active users hit 945 million in the quarter, up 39% from a year ago. Mobile represented 53% of fourth-quarter revenue, a 23% year-over-year increase.

Facebook grabbed 18.4% of worldwide mobile ad spending in 2013, up from 5.4% in the year before, according to eMarketer. Rival Google gobbled 53.2% of the worldwide mobile ad market in 2013, up slightly from 52.4% in 2012.

The overall mobile ad market worldwide grew 89% to $16.65 billion in 2013, according to eMarketer, up from $8.8 billion in 2012.

"They are going to need to continue to show new ways to grow," says analyst Olson.

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