Mixed fortunes for Facebook, Twitter and Apple


Facebook has leapt six percent in value after announcing results that were well above investors' expectations.

The result was announced on the same day that Apple rallied and Twitter plunged on the back of their earnings results.

Facebook announced a quarterly revenue increase of 59.2 percent, to US$6.44 billion (NZ$9.11 billion). That was thanks to a rapid rise in new advertisers and increased spending by existing ones.

Its mobile earnings rose 81 percent from the same time a year earlier. It now generates 84 percent of its advertising revenue from mobile ads.

It now has 1.71 billion monthly active users, an increase of 20 percent from a year ago.

Facebook's Messenger app has one billion users.

Its daily active user numbers have reached 1.13 billion, up 22 percent from the same period a year ago.

Facebook reported its numbers after the closing bell at 8am New Zealand time.

Its stock price immediately spiked 6.4 percent to US$131 in after-hours trading. That betters the stock's official all-time high during regular hours of $121.92.

The stock has rallied 29 percent in a year.

Facebook's growing advertising and user numbers are in stark contrast to Twitter.

Twitter plunged 14.53 percent to $15.77, after posting another result that disappointed investors.

The earnings report also warned that Twitter expects a sharp slowdown in its advertising revenue due to competition from other social media companies like Facebook.

Twitter's monthly user numbers grew by three percent to 313 million. That included 257 million mobile users, which is a crucial category for Twitter as it tries to boost advertising revenue.

Its third quarter revenue was US$602 million (NZ$851 million), with US$535 million(NZ$756 million) coming from advertising.

The problem for Twitter is that growth is the slowest the company has reported since listing on the sharemarket in 2013.

Twitter does not release daily user numbers, so it is hard to know how engaged people really are with Twitter.  There is a growing perception on Wall Street that Twitter has a core group of users who tweet each other, while the wider public does not really care.

Twitter needs to grow and engage its users so it is in a better position to grow its advertising revenue.

Apple's share price was rallying at the same time that Twitter was heading south.

Apple's stock price rose 6.5 percent to US$103 after reporting revenue and iPhone sales figures that were down, but still better than expected.

It has also achieved a milestone, selling its billionth iPhone.

The performance of Apple and Twitter shows how important expectations are for tech investors.

It sold 40.4 million iPhones in three months.  That was a drop of 15 percent from the previous quarter, but beat predictions of 40.02 million.

Total revenue was US$42 billion (NZ$60 billion). That was a drop of 14 percent, but again it was a better showing than analysts had expected.

Net profit fell 27 percent to US$7.8 billion (NZ$14.78 billion).

Apple's revenue from China fell by 33 percent. That followed a fall of 26 percent in the previous quarter. The slump contrasts with a sales increase of 112 percent at the same time a year ago.

The growth for Apple came from its services business (App Store, Apple Pay, iCloud).  It did better than expected, generating revenue of US$6 billion (NZ$8.49 billion).

Chief Executive Tim Cook was optimistic about the company's prospects, as it prepares for the release of the iPhone 7 and works on projects like the Apple Car.

The sales of iPhones account for two thirds of Apple's revenue.  The next generation iPhone 7 is expected to be released in September