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3 Key Estimates for Facebook's Q3 Earnings Report

As investors continue to react to this relatively strong Q3 earnings season, a handful of major reports remain. Of these, one of the most highly anticipated earnings announcements will be that of social media behemoth Facebook FB, which is due out on November 1.

Facebook has been a leader in this year’s red-hot technology sector. To date, the stock is up more than 56% as management has proven its ability to fend off competition in the booming digital advertising business.

Interestingly enough, Facebook initially warned investors that this fiscal year would be one of lower year-over-year growth and heavier spending on datacenter production and hiring. Nevertheless, the social media kind has a Zacks Rank #1 (Strong Buy), as well as an “A” grade for Growth in our Style Score system, heading into its report date.

But what should investors expect from Facebook this quarter? Well, our latest consensus estimates are calling for earnings of $1.29 per share and revenue of $9.88 billion, which would represent year-over-year growth rates of 18.64% and 40.90%, respectively.

Of course, earnings and revenue are just two of the many things investors will be looking at when Facebook reports tomorrow. Check out these three additional things to expect:

 

These important stock drivers are from our exclusive non-financial metrics consensus estimate file. These estimates are updated daily and are based on the independent research of expert stock analysts. Learn more here>>>

First up, we should highlight Facebook’s Asia-Pacific region, which appears poised to be the company’s best performer in terms of monthly active user (MAU) growth. Facebook now has over two billion MAUs worldwide, and with several population-rich countries still expanding their access to internet, this has proven to be a major source of growth for the company.

Based on our latest consensus estimates, we expect Facebook to report that it reached 782 million MAUs in the Asia-Pacific region by the end of the quarter, up from the 629 million it had at the end of the prior-year quarter.

Of course, we also have to note Facebook’s advertising growth. This category accounts for the vast majority of the company’s total revenues, and at the end of the day, Facebook is largely a digital advertising brand.

With that said, our latest consensus estimates are calling for Facebook’s advertising revenue of $9.715 billion, which would represent a nearly 43% climb from last year.

Finally, one of the other key details of Facebook’s reports is its average revenue per user (ARPU) figure. This gives investors a better idea of how well Facebook is capitalizing on each individual user, and steady growth in this category will become even more important as user growth eventually plateaus.

Based on our consensus estimate file, ARPU is expected to climb nearly 20.5% to $4.83 this quarter. 

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