Facebook Q3 Profit Rises - Update

(RTTNews) - Social networking giant Facebook Inc. (FB), Wednesday reported an increase in third-quarter profit, as a 41 percent surge in revenues more than offset a big increase in research and marketing expenses.

Menlo Park, California-based Facebook's third-quarter profit rose to $896 million or $0.31 per share from $806 million or $0.30 per share last year.

Adjusted earnings for the quarter rose to $1.63 billion or $0.57 per share from $1.15 billion or $0.43 per share last year. On average, 45 analysts polled by Thomson Reuters estimated earnings of $0.52 per share for the quarter. Analysts' estimates typically exclude one-time items.

Revenues for the quarter rose to $4.50 billion from $3.20 billion last year, as companies and other firms continue to spend heavily to advertise on the social network. Analysts had a consensus revenue estimate of $4.37 billion for the quarter.

Daily active users rose 17 percent to 1.01 billion on average in September, while monthly active users increased 14 percent to 1.55 billion in September.

Mobile daily users gained about 27 percent to 894 million on average for September, while mobile monthly users increased 23 percent to 1.39 billion.

The rise of smartphone as been a boon for Facebook with mobile advertising revenues representing 78 percent of advertising revenue for the third quarter, up from 66 percent last year.

Total costs and expenses surged 68 percent to $3.04 billion, as Facebook increased its spending on research and development as well as on marketing.

FB closed Wednesday's trading at $103.94, up $1.36 or 1.33%, on the Nasdaq. The stock further gained $2.31 or 2.22% in the after-hours trading.