Facebook Reports Fourth Quarter and Full Year 2019 Results

Facebook monthly active users (MAUs) – MAUs were 2.50 billion as of December 31, 2019, an increase of 8% year-over-year. Family daily active ... 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"Wehadagoodquarterandastrongendtotheyearasourcommunityandbusinesscontinuetogrow,"saidMarkZuckerberg,FacebookfounderandCEO."Weremainfocusedonbuildingservicesthathelppeoplestayconnectedtothosetheycareabout." FourthQuarterandFullYear2019FinancialHighlights ThreeMonthsEndedDecember31, Year-over-Year%Change YearEndedDecember31, Year-over-Year%Change Inmillions,exceptpercentagesandpershareamounts 2019 2018 2019 2018 Revenue: Advertising $ 20,736 $ 16,640 25 % $ 69,655 $ 55,013 27 % Other 346 274 26 % 1,042 825 26 % Totalrevenue 21,082 16,914 25 % 70,697 55,838 27 % Totalcostsandexpenses 12,224 9,094 34 % 46,711 30,925 51 % Incomefromoperations $ 8,858 $ 7,820 13 % $ 23,986 $ 24,913 (4) % Operatingmargin 42 % 46 % 34 % 45 % Provisionforincometaxes $ 1,820 $ 1,089 67 % $ 6,327 $ 3,249 95 % Effectivetaxrate 20 % 14 % 25 % 13 % Netincome $ 7,349 $ 6,882 7 % $ 18,485 $ 22,112 (16) % Dilutedearningspershare(EPS) $ 2.56 $ 2.38 8 % $ 6.43 $ 7.57 (15) % FourthQuarterandFullYear2019 OperationalandOtherFinancialHighlights Facebookdailyactiveusers(DAUs)–DAUswere1.66billiononaverageforDecember2019,anincreaseof9%year-over-year. Facebookmonthlyactiveusers(MAUs)–MAUswere2.50billionasofDecember31,2019,anincreaseof8%year-over-year. Familydailyactivepeople(DAP)–DAPwas2.26billiononaverageforDecember2019,anincreaseof11%year-over-year. Familymonthlyactivepeople(MAP)–MAPwas2.89billionasofDecember31,2019,anincreaseof9%year-over-year. Capitalexpenditures–Capitalexpenditures,includingprincipalpaymentsonfinanceleases,were$4.24billionand$15.65billionforthefourthquarterandfullyear2019,respectively. Cashandcashequivalentsandmarketablesecurities–Cashandcashequivalentsandmarketablesecuritieswere$54.86billionasofDecember31,2019. Headcount–Headcountwas44,942asofDecember31,2019,anincreaseof26%year-over-year. OurFamilymetricsrepresentourestimatesoftheunderlyingnumberofuniquepeopleusingoneormoreofFacebook,Instagram,Messenger,and/orWhatsApp(collectively,our"Family"ofproducts).WedefineaDAPasaregisteredandlogged-inuserofoneormoreFamilyproductswhovisitedatleastoneoftheseproductsthroughamobiledeviceapplicationorusingawebormobilebrowseronagivenday.WedefineaMAPasaregisteredandlogged-inuserofoneormoreFamilyproductswhovisitedatleastoneoftheseproductsthroughamobiledeviceapplicationorusingawebormobilebrowserinthelast30daysasofthedateofmeasurement. WebcastandConferenceCallInformation Facebookwillhostaconferencecalltodiscusstheresultsat2p.m.PT/5p.m.ETtoday.ThelivewebcastofFacebook'searningsconferencecallcanbeaccessedatinvestor.fb.com,alongwiththeearningspressrelease,financialtables,andslidepresentation.Facebookusestheinvestor.fb.comandnewsroom.fb.comwebsitesaswellasMarkZuckerberg'sFacebookPage(https://www.facebook.com/zuck)asmeansofdisclosingmaterialnon-publicinformationandforcomplyingwithitsdisclosureobligationsunderRegulationFD. Followingthecall,areplaywillbeavailableatthesamewebsite.Atelephonicreplaywillbeavailableforoneweekfollowingtheconferencecallat+1(404)537-3406or+1(855)859-2056,conferenceID1262637. Transcriptsofconferencecallswithpublishingequityresearchanalystsheldtodaywillalsobepostedtothe investor.fb.com website. AboutFacebook Foundedin2004,Facebook'smissionistogivepeoplethepowertobuildcommunityandbringtheworldclosertogether.PeopleuseFacebook'sappsandtechnologiestoconnectwithfriendsandfamily,findcommunitiesandgrowbusinesses. Contacts Investors:[email protected] /investor.fb.com Press:[email protected] /newsroom.fb.com Forward-LookingStatements Thispressreleasecontainsforward-lookingstatementsregardingourfuturebusinessexpectations.Theseforward-lookingstatementsareonlypredictionsandmaydiffermateriallyfromactualresultsduetoavarietyoffactorsincluding:ourabilitytoretainorincreaseusersandengagementlevels;ourrelianceonadvertisingrevenue;ourdependencyondatasignalsand mobileoperatingsystems,networks,andstandardsthatwedonotcontrol;risksassociatedwithnewproductsandchangestoexistingproductsaswellasothernewbusinessinitiatives;ouremphasisoncommunitygrowthandengagementandtheuserexperienceovershort-termfinancialresults;maintainingandenhancingourbrandandreputation;ourongoingprivacy,safety,security,andcontentreviewefforts;competition;risksassociatedwithgovernmentactionsthatcouldrestrictaccesstoourproductsorimpairourabilitytoselladvertisingincertaincountries;litigationandgovernmentinquiries;privacyandregulatoryconcerns;risksassociatedwithacquisitions;securitybreaches;andourabilitytomanagegrowthandgeographically-dispersedoperations.Theseandotherpotentialrisksanduncertaintiesthatcouldcauseactualresultstodifferfromtheresultspredictedaremorefullydetailedunderthecaption"RiskFactors"inourQuarterlyReportonForm10-QfiledwiththeSEConOctober31,2019,whichisavailableonourInvestorRelationswebsiteatinvestor.fb.comandontheSECwebsiteatwww.sec.gov.AdditionalinformationwillalsobesetforthinourAnnualReportonForm10-KfortheyearendedDecember 31,2019.Inaddition,pleasenotethatthedateofthispressreleaseisJanuary 29,2020,andanyforward-lookingstatementscontainedhereinarebasedonassumptionsthatwebelievetobereasonableasofthisdate.Weundertakenoobligationtoupdatethesestatementsasaresultofnewinformationorfutureevents. Non-GAAPFinancialMeasures Tosupplementourcondensedconsolidatedfinancialstatements,whicharepreparedandpresentedinaccordancewithgenerallyacceptedaccountingprinciplesintheUnitedStates(GAAP),weusethefollowingnon-GAAPfinancialmeasures:revenueexcludingforeignexchangeeffect,advertisingrevenueexcludingforeignexchangeeffectandfreecashflow.Thepresentationofthesefinancialmeasuresisnotintendedtobeconsideredinisolationorasasubstitutefor,orsuperiorto,financialinformationpreparedandpresentedinaccordancewithGAAP.Investorsarecautionedthattherearemateriallimitationsassociatedwiththeuseofnon-GAAPfinancialmeasuresasananalyticaltool.Inaddition,thesemeasuresmaybedifferentfromnon-GAAPfinancialmeasuresusedbyothercompanies,limitingtheirusefulnessforcomparisonpurposes.WecompensatefortheselimitationsbyprovidingspecificinformationregardingtheGAAPamountsexcludedfromthesenon-GAAPfinancialmeasures. Webelievethesenon-GAAPfinancialmeasuresprovideinvestorswithusefulsupplementalinformationaboutthefinancialperformanceofourbusiness,enablecomparisonoffinancialresultsbetweenperiodswherecertainitemsmayvaryindependentofbusinessperformance,andallowforgreatertransparencywithrespecttokeymetricsusedbymanagementinoperatingourbusiness. Weexcludethefollowingitemsfromournon-GAAPfinancialmeasures: Foreignexchangeeffectonrevenue.WetranslatedrevenueforthethreemonthsandfullyearendedDecember 31,2019usingtheprioryear'smonthlyexchangeratesforoursettlementorbillingcurrenciesotherthantheU.S.dollar,whichwebelieveisausefulmetricthatfacilitatescomparisontoourhistoricalperformance. Purchasesofpropertyandequipment,net;Principalpaymentsonfinanceleases. Wesubtractbothnetpurchasesofpropertyandequipmentandprincipalpaymentsonfinanceleasesinourcalculationoffreecashflowbecausewebelievethatthesetwoitemscollectivelyrepresenttheamountofpropertyandequipmentweneedtoprocuretosupportourbusiness,regardlessofwhetherweprocuresuchpropertyorequipmentwithafinancelease.Webelievethatthismethodologycanprovideusefulsupplementalinformationtohelpinvestorsbetterunderstandunderlyingtrendsinourbusiness.Freecashflowisnotintendedtorepresentourresidualcashflowavailablefordiscretionaryexpenditures. Formoreinformationonournon-GAAPfinancialmeasuresandareconciliationofGAAPtonon-GAAPmeasures,pleaseseethe"ReconciliationofGAAPtoNon-GAAPResults"tableinthispressrelease. FACEBOOK,INC. CONDENSEDCONSOLIDATEDSTATEMENTSOFINCOME (Inmillions,exceptforpershareamounts) (Unaudited) ThreeMonthsEndedDecember31, TwelveMonthsEndedDecember31, 2019 2018 2019 2018 Revenue $ 21,082 $ 16,914 $ 70,697 $ 55,838 Costsandexpenses: Costofrevenue 3,492 2,796 12,770 9,355 Researchanddevelopment 3,877 2,855 13,600 10,273 Marketingandsales 3,026 2,467 9,876 7,846 Generalandadministrative 1,829 976 10,465 3,451 Totalcostsandexpenses 12,224 9,094 46,711 30,925 Incomefromoperations 8,858 7,820 23,986 24,913 Interestandotherincome,net 311 151 826 448 Incomebeforeprovisionforincometaxes 9,169 7,971 24,812 25,361 Provisionforincometaxes 1,820 1,089 6,327 3,249 Netincome $ 7,349 $ 6,882 $ 18,485 $ 22,112 Less:Netincomeattributabletoparticipatingsecurities — — — (1) NetincomeattributabletoClass AandClassBcommonstockholders $ 7,349 $ 6,882 $ 18,485 $ 22,111 EarningspershareattributabletoClass AandClassBcommonstockholders: Basic $ 2.58 $ 2.40 $ 6.48 $ 7.65 Diluted $ 2.56 $ 2.38 $ 6.43 $ 7.57 Weighted-averagesharesusedtocomputeearningspershareattributabletoClass Aand ClassBcommonstockholders: Basic 2,853 2,872 2,854 2,890 Diluted 2,871 2,886 2,876 2,921 Share-basedcompensationexpenseincludedincostsandexpenses: Costofrevenue $ 90 $ 82 $ 377 $ 284 Researchanddevelopment 931 675 3,488 3,022 Marketingandsales 147 130 569 511 Generalandadministrative 105 84 402 335 Totalshare-basedcompensationexpense $ 1,273 $ 971 $ 4,836 $ 4,152   FACEBOOK,INC. CONDENSEDCONSOLIDATEDBALANCESHEETS (Inmillions) (Unaudited) December31,2019 December31,2018 Assets Currentassets: Cashandcashequivalents $ 19,079 $ 10,019 Marketablesecurities 35,776 31,095 Accountsreceivable,netofallowancesof$206and$229asofDecember31,2019and December31,2018,respectively 9,518 7,587 Prepaidexpensesandothercurrentassets 1,852 1,779 Totalcurrentassets 66,225 50,480 Propertyandequipment,net 35,323 24,683 Operatingleaseright-of-useassets,net 9,460 — Intangibleassets,net 894 1,294 Goodwill 18,715 18,301 Otherassets 2,759 2,576 Totalassets $ 133,376 $ 97,334 Liabilitiesandstockholders'equity Currentliabilities: Accountspayable $ 1,363 $ 820 Partnerspayable 886 541 Operatingleaseliabilities,current 800 — Accruedexpensesandothercurrentliabilities 11,735 5,509 Deferredrevenueanddeposits 269 147 Totalcurrentliabilities 15,053 7,017 Operatingleaseliabilities,non-current 9,524 — Otherliabilities 7,745 6,190 Totalliabilities 32,322 13,207 Commitmentsandcontingencies Stockholders'equity: Commonstockandadditionalpaid-incapital 45,851 42,906 Accumulatedothercomprehensiveloss (489) (760) Retainedearnings 55,692 41,981 Totalstockholders'equity 101,054 84,127 Totalliabilitiesandstockholders'equity $ 133,376 $ 97,334   FACEBOOK,INC. CONDENSEDCONSOLIDATEDSTATEMENTSOFCASHFLOWS (Inmillions) (Unaudited) ThreeMonthsEndedDecember31, TwelveMonthsEndedDecember31, 2019 2018 2019 2018 Cashflowsfromoperatingactivities Netincome $ 7,349 $ 6,882 $ 18,485 $ 22,112 Adjustmentstoreconcilenetincometonetcashprovidedbyoperatingactivities:   Depreciationandamortization 1,468 1,225 5,741 4,315   Share-basedcompensation 1,273 971 4,836 4,152   Deferredincometaxes (395) 201 (37) 286   Other (6) (19) 39 (64) Changesinassetsandliabilities:   Accountsreceivable (1,697) (1,564) (1,961) (1,892)   Prepaidexpensesandothercurrentassets 577 198 47 (690)   Otherassets (26) (60) 41 (159)   Accountspayable 112 133 113 221   Partnerspayable 289 41 348 157   Accruedexpensesandothercurrentliabilities 861 378 7,300 1,417   Deferredrevenueanddeposits 41 33 123 53   Otherliabilities (763) (735) 1,239 (634) Netcashprovidedbyoperatingactivities 9,083 7,684 36,314 29,274 Cashflowsfrominvestingactivities Purchasesofpropertyandequipment,net (4,100) (4,366) (15,102) (13,915) Purchasesofmarketablesecurities (4,758) (1,997) (23,910) (14,656) Salesofmarketablesecurities 2,163 1,254 9,565 12,358 Maturitiesofmarketablesecurities 3,104 1,381 10,152 4,772 Acquisitionsofbusinesses,netofcashacquired,andpurchasesofintangible assets (445) — (508) (137) Otherinvestingactivities,net — (21) (61) (25) Netcashusedininvestingactivities (4,036) (3,749) (19,864) (11,603) Cashflowsfromfinancingactivities Taxespaidrelatedtonetsharesettlementofequityawards (627) (545) (2,337) (3,208) RepurchasesofClassAcommonstock (1,296) (3,500) (4,202) (12,879) Principalpaymentsonfinanceleases (141) — (552) — Netchangeinoverdraftincashpoolingentities 37 500 (223) 500 Otherfinancingactivities,net 2 4 15 15 Netcashusedinfinancingactivities (2,025) (3,541) (7,299) (15,572) Effectofexchangeratechangesoncash,cashequivalents,andrestrictedcash 177 (14) 4 (179) Netincreaseincash,cashequivalents,andrestrictedcash 3,199 380 9,155 1,920 Cash,cashequivalents,andrestrictedcashatbeginningoftheperiod 16,080 9,744 10,124 8,204 Cash,cashequivalents,andrestrictedcashatendoftheperiod $ 19,279 $ 10,124 $ 19,279 $ 10,124 Reconciliationofcash,cashequivalents,andrestrictedcashtothecondensed consolidatedbalancesheets Cashandcashequivalents $ 19,079 $ 10,019 $ 19,079 $ 10,019 Restrictedcash,includedinprepaidexpensesandothercurrentassets 8 10 8 10 Restrictedcash,includedinotherassets 192 95 192 95 Totalcash,cashequivalents,andrestrictedcash $ 19,279 $ 10,124 $ 19,279 $ 10,124   FACEBOOK,INC. CONDENSEDCONSOLIDATEDSTATEMENTSOFCASHFLOWS (Inmillions) (Unaudited) ThreeMonthsEndedDecember31, TwelveMonthsEndedDecember31, 2019 2018 2019 2018 Supplementalcashflowdata Cashpaidforincometaxes,net $ 2,654 $ 1,034 $ 5,182 $ 3,762 Non-cashinvestingactivities: Netchangeinprepaidsandliabilitiesrelatedtopropertyandequipment $ (94) $ 306 $ (153) $ 918 Propertyandequipmentinaccountspayableandaccruedliabilities $ 1,887 $ 1,955 $ 1,887 $ 1,955   ReconciliationofGAAPtoNon-GAAPResults (Inmillions,exceptpercentages) (Unaudited) ThreeMonthsEndedDecember31, TwelveMonthsEndedDecember31, 2019 2018 2019 2018 GAAPrevenue $ 21,082 $ 16,914 $ 70,697 $ 55,838 Foreignexchangeeffecton2019revenueusing2018rates 295 1,669 Revenueexcludingforeignexchangeeffect $ 21,377 $ 72,366 GAAPrevenueyear-over-yearchange% 25 % 27 % Revenueexcludingforeignexchangeeffectyear-over-yearchange% 26 % 30 % GAAPadvertisingrevenue $ 20,736 $ 16,640 $ 69,655 $ 55,013 Foreignexchangeeffecton2019advertisingrevenueusing2018rates 294 1,664 Advertisingrevenueexcludingforeignexchangeeffect $ 21,030 $ 71,319 GAAPadvertisingrevenueyear-over-yearchange% 25 % 27 % Advertisingrevenueexcludingforeignexchangeeffectyear-over-year change% 26 % 30 % Netcashprovidedbyoperatingactivities $ 9,083 $ 7,684 $ 36,314 $ 29,274 Purchasesofpropertyandequipment,net (4,100) (4,366) (15,102) (13,915) Principalpaymentsonfinanceleases (141) — (552) — Freecashflow $ 4,842 $ 3,318 $ 20,660 $ 15,359   Vieworiginalcontent:http://www.prnewswire.com/news-releases/facebook-reports-fourth-quarter-and-full-year-2019-results-300995616.html SOURCEFacebook ViewallPressReleases LearnMore About Createapage Careers Privacy Terms Help Facebook©2019