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Three Months Ended March 31, |
Year-over-Year % Change |
|||||||||
In millions, except percentages and per share amounts |
2017 |
2016 |
||||||||
Revenue: |
||||||||||
Advertising |
$ |
7,857 |
$ |
5,201 |
51 |
% |
||||
Payments and other fees |
175 |
181 |
(3 |
)% |
||||||
Total revenue |
8,032 |
5,382 |
49 |
% |
||||||
Total costs and expenses(1)
|
4,705 |
3,372 |
40 |
% |
||||||
Income from operations(1)
|
$ |
3,327 |
$ |
2,010 |
66 |
% |
||||
Operating margin(1)
|
41 |
% |
37 |
% |
||||||
Provision for income taxes |
$ |
344 |
||||||||
Effective tax rate |
10 |
% |
||||||||
Net income(1)
|
$ |
3,064 |
$ |
1,738 |
76 |
% |
||||
Diluted EPS(1)
|
$ |
1.04 |
$ |
0.60 |
73 |
% |
• |
Daily active users (DAUs) – DAUs were 1.28 billion on average for March 2017, an increase of 18% year-over-year.
|
• |
Monthly active users (MAUs) – MAUs were 1.94 billion as of March 31, 2017, an increase of 17% year-over-year.
|
• |
Mobile advertising revenue – Mobile advertising revenue represented approximately 85% of advertising revenue for the first quarter of 2017, up from approximately 82% of advertising revenue in the first quarter of 2016.
|
• |
Capital expenditures – Capital expenditures for the first quarter of 2017 were $1.27 billion.
|
• |
Cash and cash equivalents and marketable securities – Cash and cash equivalents and marketable securities were $32.31 billion at the end of the first quarter of 2017.
|
• |
Headcount – Headcount was 18,770 as of March 31, 2017, an increase of 38% year-over-year.
|
FACEBOOK, INC. | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | |||||||
(In millions, except for per share amounts) | |||||||
(Unaudited) | |||||||
Three Months Ended March 31, |
|||||||
2017 |
2016(1)
|
||||||
Revenue |
$ |
8,032 |
$ |
5,382 |
|||
Costs and expenses: |
|||||||
Cost of revenue |
1,159 |
838 |
|||||
Research and development |
1,834 |
1,343 |
|||||
Marketing and sales |
1,057 |
826 |
|||||
General and administrative |
655 |
365 |
|||||
Total costs and expenses |
4,705 |
3,372 |
|||||
Income from operations |
3,327 |
2,010 |
|||||
Interest and other income, net |
81 |
56 |
|||||
Income before provision for income taxes |
3,408 |
2,066 |
|||||
Provision for income taxes |
344 |
328 |
|||||
Net income |
$ |
3,064 |
$ |
1,738 |
|||
Less: Net income attributable to participating securities |
5 |
6 |
|||||
Net income attributable to Class A and Class B common stockholders |
$ |
3,059 |
$ |
1,732 |
|||
Earnings per share attributable to Class A and Class B common stockholders: |
|||||||
Basic |
$ |
1.06 |
$ |
0.61 |
|||
Diluted |
$ |
1.04 |
$ |
0.60 |
|||
Weighted average shares used to compute earnings per share attributable to Class A and Class B common stockholders: |
|||||||
Basic |
2,891 |
2,843 |
|||||
Diluted |
2,944 |
2,905 |
|||||
Share-based compensation expense included in costs and expenses: |
|||||||
Cost of revenue |
$ |
34 |
$ |
22 |
|||
Research and development |
670 |
586 |
|||||
Marketing and sales |
96 |
82 |
|||||
General and administrative |
67 |
56 |
|||||
Total share-based compensation expense |
$ |
867 |
$ |
746 |
FACEBOOK, INC. | |||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||||
(In millions) | |||||||||
(Unaudited) | |||||||||
March 31, 2017 |
December 31, 2016 |
||||||||
Assets |
|||||||||
Current assets: |
|||||||||
Cash and cash equivalents |
$ |
7,104 |
$ |
8,903 |
|||||
Marketable securities |
25,202 |
20,546 |
|||||||
Accounts receivable, net of allowances for doubtful accounts of $86 and $94 as of March 31, 2017 and December 31, 2016, respectively |
3,415 |
3,993 |
|||||||
Prepaid expenses and other current assets |
1,209 |
959 |
|||||||
Total current assets |
36,930 |
34,401 |
|||||||
Property and equipment, net |
9,462 |
8,591 |
|||||||
Intangible assets, net |
2,360 |
2,535 |
|||||||
Goodwill |
18,126 |
18,122 |
|||||||
Other assets |
1,836 |
1,312 |
|||||||
Total assets |
$ |
68,714 |
$ |
64,961 |
|||||
Liabilities and stockholders' equity |
|||||||||
Current liabilities: |
|||||||||
Accounts payable |
$ |
170 |
$ |
302 |
|||||
Partners payable |
278 |
280 |
|||||||
Accrued expenses and other current liabilities |
2,400 |
2,203 |
|||||||
Deferred revenue and deposits |
80 |
90 |
|||||||
Total current liabilities |
2,928 |
2,875 |
|||||||
Other liabilities |
3,598 |
2,892 |
|||||||
Total liabilities |
6,526 |
5,767 |
|||||||
Stockholders' equity: |
|||||||||
Common stock and additional paid-in capital |
38,639 |
38,227 |
|||||||
Accumulated other comprehensive loss |
(626 |
) |
(703 |
) |
|||||
Retained earnings |
24,175 |
21,670 |
|||||||
Total stockholders' equity |
62,188 |
59,194 |
|||||||
Total liabilities and stockholders' equity |
$ |
68,714 |
$ |
64,961 |
FACEBOOK, INC. | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
(In millions) | |||||||
(Unaudited) | |||||||
Three Months Ended March 31, |
|||||||
2017 |
2016(1)
|
||||||
Cash flows from operating activities |
|||||||
Net income |
$ |
3,064 |
$ |
1,738 |
|||
Adjustments to reconcile net income to net cash provided by operating activities: |
|||||||
Depreciation and amortization |
671 |
552 |
|||||
Share-based compensation |
867 |
746 |
|||||
Deferred income taxes |
(84 |
) |
(77 |
) |
|||
Other |
5 |
13 |
|||||
Changes in assets and liabilities: |
|||||||
Accounts receivable |
609 |
267 |
|||||
Prepaid expenses and other current assets |
(365 |
) |
(107 |
) |
|||
Other assets |
31 |
15 |
|||||
Accounts payable |
(10 |
) |
2 |
||||
Partners payable |
(3 |
) |
(3 |
) |
|||
Accrued expenses and other current liabilities |
61 |
(18 |
) |
||||
Deferred revenue and deposits |
(10 |
) |
(2 |
) |
|||
Other liabilities |
222 |
351 |
|||||
Net cash provided by operating activities |
5,058 |
3,477 |
|||||
Cash flows from investing activities |
|||||||
Purchases of property and equipment |
(1,271 |
) |
(1,132 |
) |
|||
Purchases of marketable securities |
(6,992 |
) |
(3,126 |
) |
|||
Sales of marketable securities |
1,762 |
2,013 |
|||||
Maturities of marketable securities |
599 |
537 |
|||||
Acquisitions of businesses, net of cash acquired, and purchases of intangible assets |
— |
(1 |
) |
||||
Change in restricted cash and deposits |
11 |
33 |
|||||
Net cash used in investing activities |
(5,891 |
) |
(1,676 |
) |
|||
Cash flows from financing activities |
|||||||
Taxes paid related to net share settlement of equity awards |
(771 |
) |
— |
||||
Principal payments on capital lease and other financing obligations |
— |
(312 |
) |
||||
Repurchases of Class A common stock |
(228 |
) |
— |
||||
Other financing activities, net |
7 |
2 |
|||||
Net cash used in financing activities |
(992 |
) |
(310 |
) |
|||
Effect of exchange rate changes on cash and cash equivalents |
26 |
58 |
|||||
Net increase (decrease) in cash and cash equivalents |
(1,799 |
) |
1,549 |
||||
Cash and cash equivalents at beginning of period |
8,903 |
4,907 |
|||||
Cash and cash equivalents at end of period |
$ |
7,104 |
$ |
6,456 |
FACEBOOK, INC. | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
(In millions) | |||||||
(Unaudited) | |||||||
Three Months Ended March 31, |
|||||||
2017 |
2016(1)
|
||||||
Supplemental cash flow data |
|||||||
Cash paid during the period for: |
|||||||
Interest |
$ |
— |
$ |
11 |
|||
Income taxes, net |
$ |
664 |
$ |
170 |
|||
Non-cash investing activities: |
|||||||
Net change in accounts payable, accrued expenses and other current liabilities, and other liabilities related to property and equipment additions |
$ |
(26 |
) |
$ |
52 |
Reconciliation of GAAP to Non-GAAP Results | |||||||
(In millions, except percentages) | |||||||
(Unaudited) | |||||||
Three Months Ended March 31, |
|||||||
2017 |
2016 |
||||||
GAAP revenue |
$ |
8,032 |
$ |
5,382 |
|||
Foreign exchange effect on 2017 revenue using 2016 rates |
22 |
||||||
Revenue excluding foreign exchange effect |
$ |
8,054 |
|||||
GAAP revenue year-over-year change % |
49 |
% |
|||||
Revenue excluding foreign exchange effect year-over-year change % |
50 |
% |
|||||
GAAP advertising revenue |
$ |
7,857 |
$ |
5,201 |
|||
Foreign exchange effect on 2017 advertising revenue using 2016 rates |
22 |
||||||
Advertising revenue excluding foreign exchange effect |
$ |
7,879 |
|||||
GAAP advertising revenue year-over-year change % |
51 |
% |
|||||
Advertising revenue excluding foreign exchange effect year-over-year change % |
51 |
% |
|||||
Net cash provided by operating activities(1)
|
$ |
5,058 |
$ |
3,477 |
|||
Purchases of property and equipment |
(1,271 |
) |
(1,132 |
) |
|||
Free cash flow(1)
|
$ |
3,787 |
$ |
2,345 |