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Facebook Q1 2020 Earnings Conference Call Thoughts

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@newageinv
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I have been extending my research to reading or hearing more earnings conference calls this past earnings Season. I realize how much great insight is often achieved to get a sense of the business environment across many industries around the world. However, I continue to focus on a number of areas that interest me like social media. Facebook is definitely the leader in that sector and often provides great perspective of trends within their ecosystem. Given the unique situation we have found ourselves in, I thought it was interesting to read.

Facebook has achieved 3 billion active users for the first time ever during this quarter. They believe that adoption accelerated more this quarter given the amount of the population isolated to their homes. I have been consistently reading and hearing about the growth seen from subscription time business models that rely on a connected mindset as many seek engagement in a virtual landscape these days. We have seen the likes of Netflix, ZOOM, among many others that are actually benefiting from the current crisis seen globally. Content and an attractive community is becoming more valuable than ever!

This is an encouraging sign from a social media and networking mindset as growth continues but engagement is skyrocketing. The amount of attention that many communities are seeing is a great opportunity to create value and could give the ecosystems with the blockchain technology sectors the potential for improve adoption which had slowdown recently. Users on any platform continue to be monetized whether it be for their data or their attention; Facebook reported $17.4 billion in revenue last quarter. The advances and development from projects like ours and Brave are exciting to be a part of at the moment for these reasons. Empowering ourselves to create value is exciting to participate!

Facebook is also looking to leverage these trends as they continue to invest their resources in technology and talent to build out continued engagement. While areas where they had been focusing will likely slow given how demand has been severely impacted in certain industries, they are still looking to adding thousands of employees and billions dollars worth of technology in the year. However, rather than focused on areas impacted like traveling and tourism, they will likely focus on other areas of engagement like gaming and video. These areas have seen large levels of growth given the current situation.

With $60 billion in cash after a strong quarter, they will aggressively invest in these areas. However, it was interesting to not hear any updates on one of their key areas of investments in prior quarters; payments. It has been a priority for Facebook for over a year now with the culmination in the initial announcement of Libra, their own cryptocurrency ecosystem. Given how small business has been impacted, I was not very surprised to see no commentary nor questions related to this subject this quarter. While not a focus of my personal investment, it has been interesting to see how their insight adjusts their strategy throughout the economy. It continues to show how powerful our data and behavior is when consolidated and at the fingertips of data scientists!

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