10 ms·

Facebook reports second quarter results

95 points by aminozuur 6y ago

mtgx 6y ago
The US is looking down at an economic cliff, and the stocks keep going higher. Amazing. This won't end well (for the vast majority of people).
bpodgursky 6y ago
Up 7% after hours. That boycott! Mark must be quivering in his sweatshirt. Or, actually he knows it was just cheap PR for marketing budgets making cuts anyway (and apparently, not even that many at all).
- cowpig 6y ago
  I have a different interpretation, and mine has more to do with the naturally monopolistic nature of these platform economies, coupled with a legislature that has lost its teeth (turned into massaging fingers, maybe!) when it comes to economic problems.
  - umeshunni 6y ago
    "The good thing about platform monopolies is that there are so many to choose from"
PunchTornado 6y ago
listening to Zuckerberg yesterday in the testimony you would think fb is almost bankrupt. He tried to make it look, we're so small, don't waste your efforts on us. pick on the big guys, apple, google, amazon.
- polyomino 6y ago
  Apple, Google, and Amazon are each an order of magnitude bigger
  - Jabbles 6y ago
    In what dimension?
    - reaperducer 6y ago
      Lengthwise.
- aminozuur 6y ago
  The members of Congress were constantly interrupting the CEO's within two or three sentences. I could not watch more than a few minutes of it.
  - deleted 6y ago
    [deleted]
  - actuator 6y ago
    Yeah, some of the questioning was just stupid. Like the cookie question to Zuck. She reduced FB usage of cookie to remember the logged in user to FB using cookies against their promise.
  - imglorp 6y ago
    Yep. Hearings aren't used to get information out of witnesses. They're to grandstand. "... the smallest minds and the selfishest souls and the cowardliest hearts that God makes." -- Twain
  - novia 6y ago
    Each member of Congress was limited to 5 minutes at a time. It was clear that some of the CEOs (Bezos) had been advised to try to fill that time with as much fluff as possible. The members of Congress would ask a yes or no question, and then the CEO would start in on a speech about how great their company is. That's why you kept seeing those interruptions.
    - TLightful 6y ago
      Yep, was a basic advertising campaign. American democracy and accountability is over.
  - ponker 6y ago
    The members of Congress weren't trying to get answers from Facebook, they were trying to go viral on Facebook.
  - christophilus 6y ago
    Have you ever watched a hearing? They’re always like that. They should be renamed from hearing to interruptingvirtuesignalingandgrandstanding.
actuator 6y ago
Wow, the numbers that AAPL, AMZN, FB have reported. While everyone struggled I guess mid/big tech companies were unaffected. I am surprised ad industry is not affected heavily. Isn't ads the first thing a company will cut if things look bleak.
- overcast 6y ago
  Those AMZN numbers are completely nonsensical, how do you beat estimates by 9x? Who the hell did that estimating???
  - selectodude 6y ago
    Amazon promised to spend all of their profits on reinvestment into the company, but they didn't.
    - donor20 6y ago
      Uh? They expected to have $4B in profit, said they may spend $4B on extra expenses this period -> but demand has SOARED and they already huge, so absolutely pumping out the $. I know we've read about the major strikes by Amazon workers here repeatedly (supposedly all of them walking out etc). Doesn't seem to have affected the top line sales at least.
  - crdrost 6y ago
    Possible that estimates were before COVID was affecting us?
  - nostrademons 6y ago
    Because Amazon is comparatively low-margin vs. other tech companies, improved revenue has a much greater effect on earnings. Amazon's revenue was $88.9B vs. $81.24B expected. That's each household spending about 10% more from Amazon, which is pretty reasonable with lockdown and nobody going to brick & mortar retail outlets. But with expenses at around $80B, that translates into earnings of $10.30/share vs. $1.51.
bcatanzaro 6y ago
Look at FB's taxes. Effective tax rate went from 46% to 16% if you compare last year to this year. Made FB 1.3B extra money this quarter. I wonder if this is why Zuckerberg seems to be so friendly to Trump...
- actuator 6y ago
  If that was the reason. Every CEO would be friendly with him.
  - michaelyoshika 6y ago
    Look at Kodak.
  - metalliqaz 6y ago
    Aren't they? The CEO at my company sucks up shamelessly.
- ksdale 6y ago
  The financial says that they had a $2B penalty (which decreased net income, but I'm assuming wasn't deductible for tax purposes) and a court decision that resulted in tax of about $1B, so their effective tax rate (edit: last year) looked a lot higher than it would have without the penalty and judgment. Their tax rate didn't actually go down from year to year.
  - bcatanzaro 6y ago
    Thanks, this is helpful.
fataliss 6y ago
Can someone explain why the effective tax rate dropped so drastically for this Quarter? `16%` is a bargain! I wish I was paying 16% ...
whoisjuan 6y ago
I said this before here in HN and I'd said it again. Facebook is a freaking money making machine and will be that for many years to come. Feel whatever you want about Zuckerberg, the company, their products and anything else, but what they created is simply the best digital distribution channel besides Google. Many business are built and scaled on Facebook Ads. Putting opinions about privacy and politics aside (which are definitely topics that should be discussed), Facebook was the last Silicon Valley company to create something that literally has disrupted the way we live and interact. All the other ones that supposedly were on that road are barely alive (e.g: Uber). In contrast many of the current public tech companies with promising trajectories of global disruption (for example Shopify) were created outside of Silicon Valley. This is my personal opinion, but I think the golden Silicon Valley days are way in the past.
- dvt 6y ago
  > Many business are built and scaled on Facebook Ads. Completely agreed. Not to mention that their M&A strategy has also been nothing short of a master class: from Instagram, to WhatsApp, to Oculus. Money making machine indeed.
  - sneak 6y ago
    To that end: is it possible today to build a major VC-funded consumer facing tech company (eg Oculus) without being forced to sell to an “evil” (privacy/human rights-disrespecting amoral multinational) acquirer? Snap is the only example I can think of that remained independent so far, and even they are one App Store flipped bit away from being out of business. Are there “never Google/Facebook/Microsoft/Apple/Amazon” startups that have or would be able to raise nine figures to pursue big projects? Is that even a viable path, or is the winning endgame always just being acquired by Big Tech and Big Tech only? I guess my question is “Is avoiding major/typical VC funding the only way to “win” and not end up as FAANG staff?” The reason I ask is because I already have a perfectly comfortable lifestyle business, and would love to pursue something larger (that requires funding and a medium-sized staff) but there is no amount of money or equity that would make me ever be okay with working for a company that helps governments abuse human rights, which is 100% of Big Tech these days. Is there any third path?
subsubzero 6y ago
Of course the company is having a great quarter even with the boycotts. It has a complete strange-hold over all social media.not really counting China social media except tikTok FB - 2.4B MAU [1] Instagram(FB Owned) - 1B MAU [2]2018 numbers WhatsApp(FB Owned) - 2B MAU [3] Facebook totals - 5.4B MAU (overlap between apps, not unique users) Everyone else: Snap - 360M MAU [4] Twitter - 330M MAU [5] TikTok - 800M MAU [6] estimate Everyone else totals = 1.49B *MAU = Monthly Active User B = Billions, M = Millions [1] - https://www.businessinsider.com/facebook-grew-monthly-average-users-in-q1-2019-4 https://www.businessinsider.com/facebook-grew-monthly-averag... [2] - https://www.statista.com/statistics/253577/number-of-monthly-active-instagram-users/ https://www.statista.com/statistics/253577/number-of-monthly... [3] - https://www.statista.com/statistics/260819/number-of-monthly-active-whatsapp-users/ https://www.statista.com/statistics/260819/number-of-monthly... [4] - https://www.omnicoreagency.com/snapchat-statistics/ https://www.omnicoreagency.com/snapchat-statistics/ [5] - https://www.omnicoreagency.com/twitter-statistics/ https://www.omnicoreagency.com/twitter-statistics/ [6] - https://wallaroomedia.com/blog/social-media/tiktok-statistics/ https://wallaroomedia.com/blog/social-media/tiktok-statistic...
- dvt 6y ago
  The boycotts are priced in. Companies get to virtue signal a bit[1], but ad spend was going to go down anyway during the pandemic [1] For example, in a blatant show of hypocrisy, Nike slashed FB advertising, but has had plenty of child labor and sweatshop scandals to boot.
- ponker 6y ago
  Notably, YouTube is absent from "Everyone else"
  - subsubzero 6y ago
    Its not really a social media network, like the others in the list. You don't broadcast personal messages to your friends, and update a feed/homepage with personal info. Sort of like pinterest, and if I am missing these hidden giants please bring them up(I may have missed some).
dang 6y ago
Their press release is at https://investor.fb.com/investor-news/press-release-details/2020/Facebook-Reports-Second-Quarter-2020-Results/default.aspx https://investor.fb.com/investor-news/press-release-details/... (via https://news.ycombinator.com/item?id=24002529 https://news.ycombinator.com/item?id=24002529, merged hither)
three_seagrass 6y ago
Facebook quarterly revenue ($17.2 B) beat the expected revenue ($17.7 B) by just ~3%. I imagine this is one of the reasons Facebook didn't want to drop political ads (like the competition) in an election year.
- maskedinvader 6y ago
  I dont think money is the reason to not drop political ads, I suspect its not to antagonize the Trump administration, I see no other reason why they would take the heat for something which reportedly is a very very small portion of revenue. https://www.newsweek.com/mark-zuckerbeg-claims-revenue-facebooks-political-ads-are-too-small-justify-fact-checking-1467319 https://www.newsweek.com/mark-zuckerbeg-claims-revenue-faceb...
Gatsky 6y ago
A company built on a caricature of real social interaction... perhaps this is a trend, where profits are extracted by taking some basic human activity and creating a facsimile that exploits our worst characteristics. Fast food does this for food, tinder for romance, facebook for relationships, twitter for conversations. Second order effects come in, instead of living you can pretend to live and vlog it on youtube. Instead of doing anything (exercise, woodwork, cooking, gaming...) you can watch others doing it with fancier equipment and guaranteed success. It isn’t a ‘conspiracy’ but it does feel like humans are being diminished so their time and attention can be commodified.

95 points by aminozuur 6y ago

mtgx 6y ago

The US is looking down at an economic cliff, and the stocks keep going higher. Amazing. This won't end well (for the vast majority of people).

bpodgursky 6y ago

Up 7% after hours. That boycott! Mark must be quivering in his sweatshirt. Or, actually he knows it was just cheap PR for marketing budgets making cuts anyway (and apparently, not even that many at all).

cowpig 6y ago
I have a different interpretation, and mine has more to do with the naturally monopolistic nature of these platform economies, coupled with a legislature that has lost its teeth (turned into massaging fingers, maybe!) when it comes to economic problems.
- umeshunni 6y ago
  "The good thing about platform monopolies is that there are so many to choose from"

PunchTornado 6y ago

listening to Zuckerberg yesterday in the testimony you would think fb is almost bankrupt. He tried to make it look, we're so small, don't waste your efforts on us. pick on the big guys, apple, google, amazon.

polyomino 6y ago
Apple, Google, and Amazon are each an order of magnitude bigger
- Jabbles 6y ago
  In what dimension?
  - reaperducer 6y ago
    Lengthwise.
aminozuur 6y ago
The members of Congress were constantly interrupting the CEO's within two or three sentences. I could not watch more than a few minutes of it.
- deleted 6y ago
  [deleted]
- actuator 6y ago
  Yeah, some of the questioning was just stupid. Like the cookie question to Zuck. She reduced FB usage of cookie to remember the logged in user to FB using cookies against their promise.
- imglorp 6y ago
  Yep. Hearings aren't used to get information out of witnesses. They're to grandstand. "... the smallest minds and the selfishest souls and the cowardliest hearts that God makes." -- Twain
- novia 6y ago
  Each member of Congress was limited to 5 minutes at a time. It was clear that some of the CEOs (Bezos) had been advised to try to fill that time with as much fluff as possible. The members of Congress would ask a yes or no question, and then the CEO would start in on a speech about how great their company is. That's why you kept seeing those interruptions.
  - TLightful 6y ago
    Yep, was a basic advertising campaign. American democracy and accountability is over.
- ponker 6y ago
  The members of Congress weren't trying to get answers from Facebook, they were trying to go viral on Facebook.
- christophilus 6y ago
  Have you ever watched a hearing? They’re always like that. They should be renamed from hearing to interruptingvirtuesignalingandgrandstanding.

actuator 6y ago

Wow, the numbers that AAPL, AMZN, FB have reported. While everyone struggled I guess mid/big tech companies were unaffected. I am surprised ad industry is not affected heavily. Isn't ads the first thing a company will cut if things look bleak.

overcast 6y ago
Those AMZN numbers are completely nonsensical, how do you beat estimates by 9x? Who the hell did that estimating???
- selectodude 6y ago
  Amazon promised to spend all of their profits on reinvestment into the company, but they didn't.
  - donor20 6y ago
    Uh? They expected to have $4B in profit, said they may spend $4B on extra expenses this period -> but demand has SOARED and they already huge, so absolutely pumping out the $. I know we've read about the major strikes by Amazon workers here repeatedly (supposedly all of them walking out etc). Doesn't seem to have affected the top line sales at least.
- crdrost 6y ago
  Possible that estimates were before COVID was affecting us?
- nostrademons 6y ago
  Because Amazon is comparatively low-margin vs. other tech companies, improved revenue has a much greater effect on earnings. Amazon's revenue was $88.9B vs. $81.24B expected. That's each household spending about 10% more from Amazon, which is pretty reasonable with lockdown and nobody going to brick & mortar retail outlets. But with expenses at around $80B, that translates into earnings of $10.30/share vs. $1.51.

bcatanzaro 6y ago

Look at FB's taxes. Effective tax rate went from 46% to 16% if you compare last year to this year. Made FB 1.3B extra money this quarter. I wonder if this is why Zuckerberg seems to be so friendly to Trump...

actuator 6y ago
If that was the reason. Every CEO would be friendly with him.
- michaelyoshika 6y ago
  Look at Kodak.
- metalliqaz 6y ago
  Aren't they? The CEO at my company sucks up shamelessly.
ksdale 6y ago
The financial says that they had a $2B penalty (which decreased net income, but I'm assuming wasn't deductible for tax purposes) and a court decision that resulted in tax of about $1B, so their effective tax rate (edit: last year) looked a lot higher than it would have without the penalty and judgment. Their tax rate didn't actually go down from year to year.
- bcatanzaro 6y ago
  Thanks, this is helpful.

fataliss 6y ago

Can someone explain why the effective tax rate dropped so drastically for this Quarter? `16%` is a bargain! I wish I was paying 16% ...

whoisjuan 6y ago

I said this before here in HN and I'd said it again. Facebook is a freaking money making machine and will be that for many years to come. Feel whatever you want about Zuckerberg, the company, their products and anything else, but what they created is simply the best digital distribution channel besides Google. Many business are built and scaled on Facebook Ads. Putting opinions about privacy and politics aside (which are definitely topics that should be discussed), Facebook was the last Silicon Valley company to create something that literally has disrupted the way we live and interact. All the other ones that supposedly were on that road are barely alive (e.g: Uber). In contrast many of the current public tech companies with promising trajectories of global disruption (for example Shopify) were created outside of Silicon Valley. This is my personal opinion, but I think the golden Silicon Valley days are way in the past.

dvt 6y ago
> Many business are built and scaled on Facebook Ads. Completely agreed. Not to mention that their M&A strategy has also been nothing short of a master class: from Instagram, to WhatsApp, to Oculus. Money making machine indeed.
- sneak 6y ago
  To that end: is it possible today to build a major VC-funded consumer facing tech company (eg Oculus) without being forced to sell to an “evil” (privacy/human rights-disrespecting amoral multinational) acquirer? Snap is the only example I can think of that remained independent so far, and even they are one App Store flipped bit away from being out of business. Are there “never Google/Facebook/Microsoft/Apple/Amazon” startups that have or would be able to raise nine figures to pursue big projects? Is that even a viable path, or is the winning endgame always just being acquired by Big Tech and Big Tech only? I guess my question is “Is avoiding major/typical VC funding the only way to “win” and not end up as FAANG staff?” The reason I ask is because I already have a perfectly comfortable lifestyle business, and would love to pursue something larger (that requires funding and a medium-sized staff) but there is no amount of money or equity that would make me ever be okay with working for a company that helps governments abuse human rights, which is 100% of Big Tech these days. Is there any third path?

subsubzero 6y ago

Of course the company is having a great quarter even with the boycotts. It has a complete strange-hold over all social media.not really counting China social media except tikTok FB - 2.4B MAU [1] Instagram(FB Owned) - 1B MAU [2]2018 numbers WhatsApp(FB Owned) - 2B MAU [3] Facebook totals - 5.4B MAU (overlap between apps, not unique users) Everyone else: Snap - 360M MAU [4] Twitter - 330M MAU [5] TikTok - 800M MAU [6] estimate Everyone else totals = 1.49B *MAU = Monthly Active User B = Billions, M = Millions [1] - https://www.businessinsider.com/facebook-grew-monthly-average-users-in-q1-2019-4 https://www.businessinsider.com/facebook-grew-monthly-averag... [2] - https://www.statista.com/statistics/253577/number-of-monthly-active-instagram-users/ https://www.statista.com/statistics/253577/number-of-monthly... [3] - https://www.statista.com/statistics/260819/number-of-monthly-active-whatsapp-users/ https://www.statista.com/statistics/260819/number-of-monthly... [4] - https://www.omnicoreagency.com/snapchat-statistics/ https://www.omnicoreagency.com/snapchat-statistics/ [5] - https://www.omnicoreagency.com/twitter-statistics/ https://www.omnicoreagency.com/twitter-statistics/ [6] - https://wallaroomedia.com/blog/social-media/tiktok-statistics/ https://wallaroomedia.com/blog/social-media/tiktok-statistic...

dvt 6y ago
The boycotts are priced in. Companies get to virtue signal a bit[1], but ad spend was going to go down anyway during the pandemic [1] For example, in a blatant show of hypocrisy, Nike slashed FB advertising, but has had plenty of child labor and sweatshop scandals to boot.
ponker 6y ago
Notably, YouTube is absent from "Everyone else"
- subsubzero 6y ago
  Its not really a social media network, like the others in the list. You don't broadcast personal messages to your friends, and update a feed/homepage with personal info. Sort of like pinterest, and if I am missing these hidden giants please bring them up(I may have missed some).

dang 6y ago

Their press release is at https://investor.fb.com/investor-news/press-release-details/2020/Facebook-Reports-Second-Quarter-2020-Results/default.aspx https://investor.fb.com/investor-news/press-release-details/... (via https://news.ycombinator.com/item?id=24002529 https://news.ycombinator.com/item?id=24002529, merged hither)

three_seagrass 6y ago

Facebook quarterly revenue ($17.2 B) beat the expected revenue ($17.7 B) by just ~3%. I imagine this is one of the reasons Facebook didn't want to drop political ads (like the competition) in an election year.

maskedinvader 6y ago
I dont think money is the reason to not drop political ads, I suspect its not to antagonize the Trump administration, I see no other reason why they would take the heat for something which reportedly is a very very small portion of revenue. https://www.newsweek.com/mark-zuckerbeg-claims-revenue-facebooks-political-ads-are-too-small-justify-fact-checking-1467319 https://www.newsweek.com/mark-zuckerbeg-claims-revenue-faceb...

Gatsky 6y ago

A company built on a caricature of real social interaction... perhaps this is a trend, where profits are extracted by taking some basic human activity and creating a facsimile that exploits our worst characteristics. Fast food does this for food, tinder for romance, facebook for relationships, twitter for conversations. Second order effects come in, instead of living you can pretend to live and vlog it on youtube. Instead of doing anything (exercise, woodwork, cooking, gaming...) you can watch others doing it with fancier equipment and guaranteed success. It isn’t a ‘conspiracy’ but it does feel like humans are being diminished so their time and attention can be commodified.