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Facebook 4Q Earnings Per Shares Surge 46 Percent

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Facebook shares surged early Thursday after easily topping Wall Street’s most optimistic estimates for both revenue and earnings in the fourth quarter.

Shares of the social media giant jumped 14 percent in premarket trading. (Get the latest quote here.)

The social media giant reported that it earned 79 cents per share on $5.84 billion in revenue in the quarter. The highest estimates on the Street had called for earnings of 75 cents and revenue of $5.67 billion, according to data from Thomson Reuters.

On average, analysts had expected Facebook to report fourth-quarter earnings of about 68 cents a share on $5.37 billion in revenue, according to Thomson Reuters.

“2015 was a great year for Facebook. Our community continued to grow and our business is thriving,” Mark Zuckerberg, Facebook founder and CEO, said in the company’s earnings release.

Facebook shares surged early Thursday after easily topping Wall Street’s most optimistic estimates for both revenue and earnings in the fourth quarter.

Shares of the social media giant jumped 14 percent in premarket trading. (Get the latest quote here.)

The social media giant reported that it earned 79 cents per share on $5.84 billion in revenue in the quarter. The highest estimates on the Street had called for earnings of 75 cents and revenue of $5.67 billion, according to data from Thomson Reuters.

On average, analysts had expected Facebook to report fourth-quarter earnings of about 68 cents a share on $5.37 billion in revenue, according to Thomson Reuters.

“2015 was a great year for Facebook. Our community continued to grow and our business is thriving,” Mark Zuckerberg, Facebook founder and CEO, said in the company’s earnings release.

Shares in the company jumped more than 12 percent in after-hours trading. Even the stock of social media competitors like LinkedIn and Twitter traded higher Wednesday after the bell.

The company’s fourth-quarter earnings per share rose 46 percent from 54 cents the year-ago period, and its revenue was nearly 52 percent higher than the $3.85 billion it recorded in Q4 2014.

In total for the full year 2015, Facebook said its revenue came in at $17.93 billion — an increase of 44 percent year-over-year.

“It’s doom and gloom all around us and these guys are just killing it,” Kevin Landis, CEO and chief investment officer at Firsthand Capital Management, told CNBC’s “Closing Bell.” “One of the really impressive things about this is: Look at all the other companies in this space, and there’s train wreck out there.”

Facebook also topped estimates for its users, reporting that it saw total monthly active users (MAUs) at about 1.59 billion by the end of the quarter. Wall Street was looking for the social media giant to report total MAUs of about 1.58 billion.

Focusing in on mobile users, the company said it saw 1.44 billion mobile MAUs — which beat the Street’s expectation of 1.43 billion, according to StreetAccount.

For the first time, more than 90 percent of both monthly and daily active users were on mobile, according to the company.

On the company’s earnings call, Zuckerberg said users watch 100 million hours of video daily on the platform, and that the company is “exploring ways to give people a dedicated place on Facebook for when they just want to watch videos” — potentially hinting at a competitor for Alphabet’s YouTube.

The CEO also said the company is working to improve its Facebook Lite app for low bandwidth environments (like in developing countries), and that it now has more than 80 million users.

Speaking with CNBC after the quarterly announcement, Facebook COO Sheryl Sandberg said she sees consumers making the shift to mobile, and that the company is no longer having conversations with business about if they should advertise on mobile, but how to best employ the platform.

“Certainly economic uncertainty in the broad macroeconomic environment affects all businesses, it affects our clients, it affects us, but that said we think we’re really well positioned to continue to take advantage of and double down on the shift to mobile which is happening,” she said. “We also know we have a lot of hard work ahead of us.”

On the advertising revenue, Facebook also beat analysts’ average expectation of $5.15 billion — according to StreetAccount — with a blow-out $5.64 billion in the quarter. Mobile advertising revenue, meanwhile, came in at $4.51 billion, Facebook said, against expectations of $4.09 billion.

Mobile advertising revenue represented about 80 percent of all ad revenue, the company said, compared to about 69 percent in the year-ago period. Ad impressions on mobile, meanwhile, increased 29 percent on a year-over-year basis, Facebook CFO David Wehner said, adding that 2015’s final quarter was the first since Q3 2013 in which total ad impressions increased against the year-ago period.

There are now more than 2.5 million active advertisers working with Facebook, Zuckerberg said on the call.

For the fourth quarter, Facebook saw average revenue per user (ARPU) of about $3.73, while Wall Street had only expected $3.43, according to StreetAccount.

“The revenue per user is an important number, but I always kind of look at usage more than users,” said Martin Pyykkonen, senior research analyst at Rosenblatt Securities. “Facebook is getting to a deceleration in that, but the average revenue was still very strong.”

Despite the quarter’s strong revenue figures, Wehner cited the strengthening U.S. dollar’s “unfavorable impact” on the company’s financials. Had exchange rates remained constant with the year-ago period’s levels, total revenue would have been about $320 million higher, Wehner said on the call.

That strong dollar will continue to affect comparisons, he predicted, saying that Facebook expects “to continue to face foreign exchange headwinds, especially early in the year, as we will be lapping periods where the dollar was relatively weaker than it is today.”

More broadly, Wehner predicted that the company will also face “tougher” comparisons throughout 2016 given the “remarkably strong advertising performance” last year.

Looking at the global macroeconomic environment — which has recently given many companies trouble — Wehner said Facebook did not see anything in its fourth quarter that indicated “broad-based macro weakness” beyond currency effects.

Beyond the flagship Facebook platform, investors also closely watch the growth of its WhatsApp and Instagram services. Earlier this month, WhatsApp said it would no longer charge annual subscription fees and would begin testing ways for users to communicate directly with businesses.

“We are really pleased with the growth in the advertiser adoption on Instagram,” Sandberg told CNBC, revealing that 98 of the company’s top 100 Facebook marketers are also now on Instagram.
On the call, Zuckerberg said WhatsApp ended the year with nearly 1 billion monthly active users.

The company’s moonshots are also in focus, with analysts wondering about the upside potential from its work in virtual reality and big data.

“We believe it is entirely plausible that VR is the future of computing,” Robert Peck, managing director and Internet equity analyst at SunTrust Robinson Humphrey, wrote in a recent note, adding it has “the potential to disrupt several diverse businesses.”

On the Oculus virtual reality platform, Zuckerberg didn’t mince his words.

“Yes I am happy. I don’t show much joy, but I am happy,” he said. “It’s going to be gaming — for the beginning. That’s the initial market…I think it’s around 250 million people who have Xboxes, Playstations or Wiis. That’s the initial market of folks who we think are going to be most interested in the early VR experiences, especially at some of the higher price points.”

“But the reason why we’re interested in this, as the social company, is that we think this is going to be a new way that people interact,” Zuckerberg explained. “We’re very excited about that: That’s going to be a big area of investment for us, and is ultimately, I think, going to change the way that we communicate, and live and work — in addition to how we play games.”

CNBC

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Telecommunications

Airtel Africa Customer Base Rises by 8.4 Percent to 120.8 Million in Q1, 2022

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Airtel Africa Plc - Investors King

Airtel Africa Plc, a leading telecommunications company in Africa, grew its customer base by 8.4 percent to 120.8 million in the first quarter (Q1) of 2022.

The telecoms giant recorded strong revenue in Nigeria, up by 38.2 percent and posted 32.8 percent in East Africa while it achieved 24.9 percent in Francophone Africa.

Airtel Africa’s first quarter begins from April to June of the current year and the year ended in the first quarter of the following year. Hence, why it is quoted Q1 2022.

Airtel Africa Q1 Highlights

 Q1’22 Reported revenue grew by 30.7% to $1,112m, with constant currency growth of 33.1%. Revenue growth partially benefitted from a weakened quarter in the prior year during the peak of Covid-19 restrictions across the region. Even after adjusting for these effects, revenue growth rates for the Group, service segments and reporting regions were all ahead of Q4’21 trends.
 Strong revenue growth was recorded across all regions: Nigeria up 38.2%, East Africa up 32.8% and Francophone Africa up 24.9%; and across key services, with revenues for voice up 26.0%, data up 37.4% and mobile money up 53.7%.
 Underlying EBITDA grew by 42.4% to $534m in reported currency, while constant currency growth was 46.2%.
 Underlying EBITDA margin was 48.0%, an increase of 396 basis points(increase of 428 basis points in constant currency) led by both revenue growth and improved operational efficiencies.
 Operating profit was $352m, up 67.6% in reported currency and 73.9% in constant currency.
 Profit after tax more than doubled to $142m, up 148.7%, largely due to the higher operating profits along with stable net finance costs which more than offset the increase in tax charges due to increased profits.
 Basic EPS was 3.3 cents, an increase of 200%, as a result of higher profit and stable finance costs and foreign exchange. EPS before exceptional items was 3.2 cents.
 Operating free cash flow (underlying EBITDA less capex) was $428m, up 38.7%.
 Customer base grew by 8.4% to 120.8 million, with increased penetration across mobile data (customer base up 14.8%) and mobile money services (customer base up 24.6%). The slowdown in customer base growth was due to new SIM registration regulationsin Nigeria; excluding Nigeria the customer base grew by 15.9%.

Commenting on the company’s performance, Raghunath Mandava, chief executive officer, said “Our Q1’22 results have been very strong, with reported growth of 30.7% in revenue and 42.4% in underlying EBITDA, with constant currency growth of 33.1% and 46.2% respectively. Q1 of last year was impacted by the start of Covid, but even after adjusting for these effects, our Q1’22 revenue growth rates for the Group, service segments and reporting regions were all ahead of Q4’21 trends.

We have posted strong double-digit growth across voice (26.0%), data (37.4%) and mobile money (53.7%), and across all our regions. Sub-Saharan Africa is now experiencing a third wave of the pandemic. Governments are implementing balanced measures of lockdowns and restrictions. But vaccinations levelsremain very low. In these challenging times our business model has so far proven resilient, but we continue to monitor the situation closely for the potential impact on local economies and consumers.

Our total customer base has returned to growth with acceleration in our East Africa and Francophone regions and despite continuing negative net additions in Nigeria. With the easing of these restrictions in late April we have since been able to gradually increase locations for activations in line with regulatory compliance across Nigeria, and we have begun adding new customers.

Our continued focus on modernisation and rollout of our network, along with simplifying our products and improving our distribution, have all helped us to make handsome gains on our ARPUs across voice, data and mobile money. Our robust operating model and solid execution should enable us to continue our profitable growth.

We continue to see huge potential across voice, data and mobile money due to the low penetration levels in Africa, as we continue to partner the nations in bridging the digital divide and enhancing financial inclusion. We remain committed to continue to efficiently and effectively deliver services that help to improve the lives, communities and economies we serve.”

 

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Google to Introduce Strike-Based System to Clamp Down on Advertisers Violating Google Ads Policies

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Google News - Investors King

The world’s leading search engine Google on announced it will introduce a new strike-based system to clamp down on advertisers who repeatedly violate the company’s ads policies.

In a statement released on Wednesday, the tech giant said the new strike based system would be introduced in September 2021, to be precise it said implementation of the new system will commence on September 21, 2021, “with a gradual ramp up over a period of 3 months, for the following policies: Enabling dishonest behavior, Unapproved substances, Guns, gun parts and related products, Explosives, Other Weapons, and Tobacco.”

“The policy coverage of the strike-based system will be expanded to add additional policies in phases over time and advertisers will be notified each time new policies are brought within scope of the strike-based system.

“Please note that this update does not impact the account suspension procedures for egregious Google Ads policy violations.

What’s changing:

To help ensure a safe and positive experience for users, Google requires advertisers to comply with Google Ads policies. As a part of the Google Ads enforcement system, Google will begin issuing strikes to advertisers, which will be accompanied by email notifications and in-account notifications to encourage compliance and deter repeat violations of our policies.

An advertiser’s first policy violation will only result in a warning. But advertisers will earn their first strike if we detect continued violation of our policies. Advertisers will be able to receive a maximum of three strikes, and the penalties applied with each strike will progressively increase. Temporary account holds will be applied for the first and second strikes (for 3 and 7 days respectively), while the third strike will result in an account suspension.

An advertiser placed on a temporary account hold will be required to remedy the violations in question and to submit an acknowledgement form to resume serving ads. Following this acknowledgement, their account will be released from the temporary account hold state either 3 days after the first strike was issued, or after 7 days for a second strike. Advertisers can also appeal a strike decision if they believe it was issued in error. Ads will resume serving immediately after successfully appealing the strike. Accounts will remain on temporary hold if no action is taken by the advertiser to either acknowledge or appeal a strike. Strikes will remain on the Google Ads account for 90 days unless they’re successfully appealed.

Accounts suspended following a third strike will not be able to run any ads or create new content unless the suspension is successfully appealed. Learn more about suspended accounts.

 

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Technology

Fintech CEO: Cheyney University Offers Ghana an Opportunity to Expand Technology Footprint

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University - Investors King

Last week, reports manifested of a newly announced partnership between Cheyney University and the soon-to-be-built Oboseke University of Excellence. Within the partnership, the American college, which is situated only thirty miles from Philadelphia, will help the new university in Ghana set up a program focused on aquaponics and aquaculture. In exchange, Oboseke University will provide space on its campus for projects of joint interest.

“For folks unfamiliar with food production, they are often unfamiliar with the extensive use of technology employed in the industry, particularly in the realm of aquaponics. My understanding is that Cheyney’s existing program grows tilapia, and then they use the waste as fertilizer for their basil. Ghana currently imports a significant portion of its tilapia from China, so this aquaponics program is a great way to help provide real value to the local community. However, the partnership could go beyond aquaponics,” suggested Richard Gardner, CEO of Modulus, a US-based developer of ultra-high-performance trading and surveillance technology that powers global equities, derivatives, and digital asset exchanges.

“You’re sitting on a new university that really has yet to define itself. It’s already looking into how its programs can provide real value to the people of Ghana. It has established a relationship with a college in the United States which would presumably like to continue to build its footprint. Notably, Cheyney partnered recently with a biochem company, leading to the opening of a laboratory on its campus. This new partnership would be a great cornerstone for Oboseke University to build on, and to develop and serve as an incubator for young innovators who attend as students,” opined Gardner.

“To be able to share our experience and knowledge with this emerging African university, and potentially help the people of Ghana develop a more accessible food supply, is an extremely significant opportunity for us, a tribute to our academic excellence, and an honor,” Cheyney President Aaron Walton has been quoted as saying.

“First, start with food supply. Then look at technology. Ghana is currently leading the way in its region, as it works toward developing a central bank digital currency. That program relies heavily on blockchain technology, and it appears that Ghana is well-ahead of its neighbors on this issue. They’re starting to build a culture of innovation, and this partnership with Cheyney really allows them to further develop that. If the universities collectively brought in a few advisors from both sides of the ocean, they could offer a workspace to innovators in Ghana who are building technologies based on blockchain concepts or in other similar avenues, such as artificial intelligence or within MedTech,” Gardner says.

Modulus is known throughout the financial technology segment as a leader in the development of ultra-high frequency trading systems and blockchain technologies. Over the past twenty years, the company has built technology for the world’s most notable exchanges, with a client list which includes NASA, NASDAQ, Goldman Sachs, Merrill Lynch, JP Morgan Chase, Bank of America, Barclays, Siemens, Shell, Yahoo!, Microsoft, Cornell University, and the University of Chicago.

“Sometimes, we think of an incubator as an institution with hundreds of millions of dollars in backing and the most prestigious minds in the industry serving as advisors. But, sometimes, it can all start with folks who want to volunteer their time and expertise to help the next generation build something really cool. In a world filled with venture capital raises, it is easy to forget that, sometimes, all innovators need is a little conceptual guidance to bring their vision to life,” said Gardner.

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