SAN FRANCISCO – Facebook said on Wednesday that it made a profit of $4.9 billion in the first quarter, doubling the $2.43 billion posted in the same period of 2019 despite the sharp downturn in digital advertising that has accompanied the virtual shutdown of the US economy to contain the coronavirus.
Analysts have been pointing for weeks to the paradox confronting Facebook and the other heavyweight in digital advertising, Google parent company Alphabet Inc.
With people stuck at home, both companies have seen the use of their platforms soar, yet the money from advertisers has largely dried up.
Even so, the numbers released on Tuesday by Alphabet beat expectations and Facebook also presented the markets with a pleasant surprise.
The social-networking giant earned revenue of $17.74 billion in the first three months of 2020, up 17 percent from the first quarter last year, while earnings per share grew over the 12 months from 85 cents to $1.71.
Sounding a note of caution, Facebook said that the pandemic lockdown was in effect only for the final three weeks of Q1.
“Due to the increasing uncertainty in our business outlook, we are not providing specific revenue guidance for the second quarter or full-year 2020, but rather a snapshot on revenue performance in the second quarter thus far,” the company said.
“After the initial steep decrease in advertising revenue in March, we have seen signs of stability reflected in the first three weeks of April, where advertising revenue has been approximately flat compared to the same period a year ago,” Facebook said.
“The April trends reflect weakness across all of our user geographies as most of our major countries have had some sort of shelter-in-place guidelines in effect,” the statement added.
Facebook, which is almost entirely dependent on spending by advertisers, had an average of 1.73 billion daily active users in March, representing a gain of 11 percent over the level of a year ago.
The figure for monthly active users was 2.6 billion, equivalent to nearly a third of the world’s population.
“Our work has always been about helping you stay connected with the people you care about. With people relying on our services more than ever, we’re focused on keeping people safe, informed and connected,” Facebook founder and CEO Mark Zuckerberg said.
The results were good enough to boost Facebook’s price-per-share by 10.33 percent to $214.14 in after-hours electronic trading on the New York Stock Exchange.