Facebook's Post-Earnings Faceplant
Out of the gate, Facebook's (FB) stock was hammered today. The report looked very good overall. I believe the initial reaction was a combination of sell-the-news and a slightly higher expectation of revenue from mobile. If you ask me, the second reason is slightly ironic, given that this is a company that until recently had no revenue from mobile, and now it is up to almost 25%.
During the conference call, talk of higher expenditures to grow the business threw cold water on the after-hours rally. These expenses would pressure margins, as new initiatives wouldn't show benefits in the short run. Isn't this a similar strategy to Amazon's (AMZN)? In this market, it is clear that Amazon gets its own shelf space. What is good for Amazon is only good for Amazon....375 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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