Facebook’s First Public Earnings, Q2 2012, Scheduled For July 26th

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Facebook will give investors and the world their first official look at its post-IPO earning for Q2 2012 at 2pm PST on July 26th, according to a brief note posted to its investor relations page just now. There’s been no indication of whether CEO Mark Zuckerberg will participate in an earnings call or if more business focused execs COO Sheryl Sandberg and CFO David Ebersman will be the ones fielding questions.

The company pulled in $1.058 billion in Q1 2012 revenue with a net income of $205 million. Critics will want to see both of those increase and will likely focus on its mobile revenue. Facebook only began showing ads on mobile at the end of February, but monetizing the medium is believed to be the linchpin of Facebook’s future success.

The company’s share price closed at $31.095 today, down $0.265 or 0.85% and beneath the recent peak it hit at $32.86 on June 25th. It’s still closer to the $38 IPO price than its been for most of the time since its May 18th public debut, though. Here’s a look at the last earnings and revenue info it released in its S-1 prior to its IPO.

Facebook gave potential investors a scare when its showed that despite revenue going up 44.7% from Q1 2012, it was down 6.5% from Q4 2011. While surely influenced by the waning of holiday advertising, many suspected this was the first sign of slowing momentum due to the shift of its user base to mobile where it wasn’t monetizing as effectively.

But recent data first published by TechCrunch showed very strong potential for Sponsored Stories ads in the news feed to make mobile a significant revenue stream. Facebook’s biggest advertising API partners showed users were 13 times more likely to click mobile Sponsored Stories than its desktop ads, and they earn the social network 11 times more each.

Facebook is purposefully throttling the ramp up the presence of these ads as not to shock users who’ve had their mobile experience ad-free for years. Finding the maximum number of ads it can show without decreasing usage and engagement, or leaving sour taste in users’ mouths will be crucial.

While their power won’t be reflected in the Q2 2012 earnings, there are three new Facebook ads products that could make future earnings releases a lot shinier:

  • Facebook Exchange – a retargeting system that lets third-party websites drop cookies on visitors and then target them with ads on Facebook designed to get them to complete purchases they may have been considering
  • Hyper-Local Ad Targeting – While not confirmed, Facebook is reportedly working on more accurate local ad targeting that could show users ads related to businesses they’re within a few hundred feet of
  • Off-Site Facebook Ads – Facebook last week began showing ads on Zynga.com in a revenue sharing agreement that could eventually blossom into a lucrative ad network on more third-party sites

Taking these new developments into account, the three lead investment banks who underwrote Facebook’s IPO, JP Morgan, Goldman Sachs, and Morgan Stanley all issued the equivalent of a”buy” ratings this week. Other banks issued “neutral” or “hold” ratings.

Many want to see signs that Facebook will weather the transition to mobile gracefully. If it can show as much on July 26th and the price stays where it is now, investors might flock to Facebook. Regardless of the financials, the sheer presence of Mark Zuckerberg on the earnings call could reassure investors who may worry they’re far down the young CEO’s list of priorities after he skipped several meetings with them during the pre-IPO roadshow.

And if he does join the call, I better not hear one analyst mention of hoodies, pokes, or any of those awful Facebook puns.