Facebook sees stock surge amid rise in sales and new users

Facebook has seen a significant rise in new users and sales, the US social media giant said in its quarterly report published on Wednesday. 

The announcement caused stocks to surge by more than 10 per cent in after-hours trading. 

The world’s largest online network gained 100 million new users to a total of 2.6 billion within three months, a significant increase compared to its usual gains of around 50 million new users every quarter.

The report said first-quarter sales rose 18 per cent year over year to 17.7 billion dollars thanks to a good first couple of months.

However, the company cautioned that ad revenue – which Facebook almost exclusively earns its money from – would slow in the months ahead and had already slowed in March due to economic fallout from the novel coronavirus pandemic.

The report said that the company is facing “a period of unprecedented uncertainty” in its business outlook during the pandemic.

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The comments came after advertising customers became more frugal in March and April with many small and medium-sized companies, which Facebook depends on, being adversely affected by coronavirus-related restrictions.

The company said it has seen “signs of stability” in the first three weeks of April, where advertising revenue had decreased by 17 per cent compared to the same period last year. (dpa)