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Facebook Inc (FB)’s Q3 Results Did Not Include Instagram

Facebook Inc (NASDAQ:FB) had a brilliant third quarter, and investors have pushed the stock up more than 20% since its post-market earnings release yesterday. In case you missed it, or have been living under a rock, here’s our highlights of the company’s Q3 financials, in addition to our coverage of how hedge funds fared. Earlier today, we also took a look at a study by Adobe Systems that shared some truly insightful statistics above user engagement. Full coverage can be found here, but in short, the number of comments, shares, and likes on Facebook Inc (NASDAQ:FB) has grown close to 900% year-over-year. Yes, that’s a nine with two zeros. Wow.

Facebook Inc (FB), JetBlue Airways Corporation (JBLU)

Another interesting tidbit about Facebook Inc (NASDAQ:FB)’s Q3 earnings is that they did not include any Instagram financials. The popular photo-sharing app was a controversial acquisition for Mark Zuckerberg and Co. earlier this year, but the CEO sang its praises in yesterday’s release. Here’s the highlights from Facebook Inc (NASDAQ:FB)’s call:

Additionally, I want to talk about Instagram. This is really a platform success story. We got to know them because they built a social integration with us that a lot of people really liked, and both companies saw the opportunity to do even more together. When we agreed to acquire them, Instagram had 27 million registered users. Today, they have more than 100 million. The most recent comScore reports show that in the U.S., there’s more mobile time spent on Instagram than on Twitter. By giving Instagram access to some of the tools we have internally here at Facebook Inc (NASDAQ:FB), they can grow even faster than they would have alone.

While we all know that Mark Zuckerberg will give undying support of Facebook Inc (NASDAQ:FB)’s purchase of Instagram, it’s significant that the platform’s users now spend more time on it than Twitter. Post-acquisition user growth of 270% is also extraordinary.

Facebook Inc (NASDAQ:FB)’s CFO David Ebersman added more fuel to the bulls’ fires, explaining that “none of the user numbers include Instagram, which as Mark mentioned passed 100 million registered users and continues to grow,” in addition to stating the following:

In terms of Instagram, we closed the acquisition towards the end of the third quarter, so the impact was next to zero, certainly zero on the top line, and next to zero on the bottom line. In the fourth quarter, we will have expenses both from the employees and the investments we’re making in Instagram and also the amortization of the intangible assets that we acquire.

While the last quarter was important for Facebook Inc (NASDAQ:FB), Q4 may be even more crucial, as it will represent the first time investors will get a full look at the company’s Instagram integration. Early analyst estimates expect Facebook to reach an EPS of 14 cents a share, with revenues of $1.43 billion. Those are the key numbers at the moment, and Facebook Inc (NASDAQ:FB) investors should remain aware of any revisions. Stay updated on this situation at Insider Monkey, and read the rest of our Facebook Inc (NASDAQ:FB) coverage here.

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