Investing.com – Facebook stock (NASDAQ:FB) traded 3% higher in Tuesday’s premarket as the company notched up more active users during the third quarter and authorized an additional $50-billion buyback.
The company has guided for $31.5 billion-$34 billion in current-quarter revenue, which, while being below analysts’ forecasts, indicates that sequential growth is still possible despite more than a year of surge in pandemic-driven traffic.
Facebook will also spin off its augmented and virtual reality operations, giving more visibility into the investments it is making in the business. Those investments will shave $10 billion off the company’s operating profit this year.
Daily active users, or DAUs, a key metric advertisers use to determine the reach and effectiveness of a platform, rose to 2.81 billion. This was higher by around 11% year-on-year and up 2% on a sequential basis, reflecting that while the pandemic-driven surge is behind, its platforms are still managing to attract users. As per reports, CEO Mark Zuckerberg is focused on attracting younger people to its platforms as its earlier adopters age. This comes at a time when the company is under tight scrutiny from the Congress amid a whistleblower's charges that it prioritizes growth over safety and has knowingly ignored its own findings that its Instagram platform is toxic for young females.
Total revenue growth slowed to 35% on-year to $29 billion from over 50% in the first half and fell below analysts’ estimates. Chief Operating Officer Sheryl Sandberg told analysts if it weren't for Apple's (NASDAQ:AAPL) iOS14 changes, the company “would have seen positive quarter-over-quarter revenue growth."
Under Apple's new privacy policy, users now have to opt-in to let apps track them, a turn-off for advertisers.