January 31, 2013 10:04:19 AM
NEW YORK -- Facebook delivered fourth-quarter results above Wall Street's expectations on Wednesday and sought to show that it has finally transformed into a "mobile company."
But its stock dropped sharply in after-hours trading as investors placed more significance on the company's growing expenses rather than on its increasing user base and higher advertising revenue.
"Everything was slightly better than expected," said Wedbush Securities analyst Michael Pachter. "I don't see anything here that would make me want to sell the stock."
Nonetheless, Facebook's stock fell $1.34 cents, or 4.3 percent, to $29.90 in after-hours trading following the earnings report.
Facebook grew its revenue and increased the proportion of revenue that comes from mobile advertising -- a closely watched figure. But expenses also grew sharply. Also, the company said 2013 will be a year of "significant investments" and hiring as it focuses on long-term growth rather than short-term profits.
Facebook Inc., the world's largest social media company, earned $64 million, or 3 cents per share, in the October-December period. That's down from $360 million, or 14 cents per share, a year earlier when it was still a privately held company.
Revenue rose 40 percent to $1.59 billion from $1.13 billion, surpassing analysts' expectations of $1.51 billion.
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