Tech Times: Facebook shares surge on strong mobile ad growth
SAN FRANCISCO (TNS):
In an earnings season in which other major tech companies could do very little right, Facebook could do no wrong.
The tech giant delivered relief to Wall Street in the midst of a dismal spate of tech earnings with yet another quarterly earnings beat, this one propelled by its robust mobile advertising business and growing momentum for video advertising.
Facebook shares soared more than nine per cent to $119.18 in last Thursday morning's trading.
Facebook reported first-quarter results after the markets closed the previous day.
Facebook seized the opportunity to announce a three-for-one stock split to create a new class of non-voting shares.
The stock split is designed to keep Facebook CEO Mark Zuckerberg in control of the tech giant. If the split is approved, Facebook shareholders will receive two non-voting shares for each single share they hold.
Shareholders are scheduled to vote on the proposal at the company's annual meeting on June 20.
Few investors are likely to object to Zuckerberg's tight control of the company if he can keep delivering Street-beating financial results.
Facebook has topped estimates in all but one quarter since its initial public offering four years ago.
Other fast-growing tech companies have used new share classes so founders can retain control.
Google parent, Alphabet, issued a special share class in 2014 to give Larry Page and Sergey Brin more freedom to take risks on speculative technologies and new businesses.
Zuckerberg laid out his 10-year vision for Facebook at the company's annual developer conference earlier this month. Among his ambitions are to connect the rest of the world to the Internet, developing artificial intelligence that can automate communication and commerce, and turn virtual reality into the next big social platform where friends and family can spend time together.
Zuckerberg and wife, Priscilla Chan, have also pledged to give away 99 per cent of their Facebook shares to tackle some of the world's most complex problems over the couple's lifetime.
"I'll be able to keep founder control of Facebook so we can continue to build for the long term," Zuckerberg said.
"I see more bold moves ahead of us than behind us."