Facebook Stock Drops 7% Despite Earnings Beat

Facebook (NASDAQ: FB) reported fourth-quarter and full-year 2019 results after the closing bell on Wednesday that disappointed the market. 

Shares of the social-networking and tech behemoth plunged 7% in Wednesday's after-hours session, which doesn't bode well for the stock's performance on Thursday.

For the quarter, Facebook surpassed Wall Street's consensus estimates on both the top and bottom lines. However, the beats were notably smaller than usual, which was no doubt a big reason for the market's ire. Another major factor was likely soaring year-over-year total costs and expenses, which rose 34% in the quarter and 51% in full-year 2019. Investors are concerned that beefed-up costs and expenses are here to stay and will continue to eat into profits. These higher costs and expenses are being driven by the company's mandate by the U.S. Federal Trade Commission (FTC) to improve data security and user privacy.

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Source Fool.com