Summary
Meta Platforms, Inc. (then Facebook, Inc.) reported strong financial results for the third quarter and the first nine months of 2020, driven by robust revenue growth in its advertising business. Revenue increased by 22% year-over-year for the third quarter to $21.47 billion and by 17% for the nine-month period to $57.89 billion. This growth was primarily fueled by an increase in the number of ads delivered, despite a slight decrease in average price per ad, which management attributed to the shift towards Stories ads and monetization in lower-cost geographies. The company also saw significant growth in its user base, with Facebook Daily Active Users (DAUs) reaching 1.82 billion and Family Daily Active People (DAP) reaching 2.54 billion on average for September 2020. This user engagement, coupled with the recovery in advertising demand post-Q2 pandemic dip, contributed to healthy income from operations of $8.04 billion and a net income of $7.85 billion for the third quarter. The company ended the period with a strong balance sheet, holding $55.62 billion in cash and cash equivalents and marketable securities.
Financial Highlights
49 data points| Revenue | $21.47B |
| Cost of Revenue | $4.19B |
| Gross Profit | $17.28B |
| R&D Expenses | $4.76B |
| Operating Expenses | $13.43B |
| Operating Income | $8.04B |
| Net Income | $7.85B |
| EPS (Basic) | $2.75 |
| EPS (Diluted) | $2.71 |
| Shares Outstanding (Basic) | 2.85B |
| Shares Outstanding (Diluted) | 2.89B |
Key Highlights
- 1Revenue grew 22% year-over-year to $21.47 billion in Q3 2020, primarily driven by a 22% increase in advertising revenue.
- 2Facebook DAUs increased 12% year-over-year to 1.82 billion on average for September 2020, while Family DAP increased 15% to 2.54 billion.
- 3Income from operations was $8.04 billion, with an operating margin of 37% for Q3 2020.
- 4Net income for Q3 2020 was $7.85 billion, translating to diluted EPS of $2.71.
- 5The company made a significant equity investment in Jio Platforms Limited for $5.82 billion in July 2020.
- 6Share repurchases totaled $4.36 billion for the nine months ended September 30, 2020, with $10.55 billion remaining authorized.
- 7The company settled with the FTC, paying a $5.0 billion penalty in April 2020, and agreed to a $650 million settlement for a biometric privacy class action lawsuit.