As Facebook Revenue Soars, the SOCL ETF Hits the 'Like' Button

Social media giant Facebook beat earnings and revenue expectations during the first quarter of 2021, which should help give the Global X Social Media ETF (SOCL) a lift.

Facebook, which comprises about 12% of SOCL’s net assets, ousted Wall Street’s expectations in earnings and revenue. The social media company missed out slightly on daily active users and monthly active users, but made up the deficit by beating expectations on average revenue per user.

Here were Facebook’s Q1 numbers, as reported by CNBC:

  • Earnings: $3.30 per share vs. $2.37 per share forecast
  • Revenue: $26.17 billion vs. $23.67 billion expected
  • Daily active users (DAUs): 1.88 billion vs. 1.89 billion forecast by FactSet
  • Monthly active users (MAUs): 2.85 billion vs. 2.86 billion forecast by FactSet
  • Average revenue per user (ARPU): $9.27 vs. $8.40 forecast by FactSet

“Facebook said it expects its revenue growth to remain stable or accelerate modestly in the second quarter compared with slower growth a year prior due to the pandemic,” CNBC reported. “The company, however, expects revenue growth in the third and fourth quarters to significantly decelerate sequentially compared with fast growth experienced during those periods a year prior as a result of the pandemic.”

As Facebook Revenue Rises, Hit The Like Button for "SOCL" 1

SOCL seeks to provide investment results that correspond generally to the price and yield performance of the Solactive Social Media Total Return Index. The index tracks the equity performance of the largest and most liquid companies involved in the social media industry, including companies that provide social networking, file sharing, and other web-based media applications.

The pandemic certainly put web-based applications at the forefront. Social networking sites like Facebook have allowed individuals to keep tabs on friends and family amid social distancing measures. SOCL is up over 110% the last 12 months and roughly 14% in 2021.

SOCL Chart

More Than Just Social Networking

Facebook is also looking to become a full-fledged e-commerce site. One of the areas the company is seeking to expand is its marketplace service. The company also has plans to offer a form of digital currency, as well as a digital wallet.

“Commerce across all these platforms is going to be very important, and certainly in a platform that we’re building like this, we want to enable payments very easily to make it so the economics all work out for developers,” CEO Mark Zuckerberg said.

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