Facebook (FB) is set to report Q3 results after the bell with a conference call slated for 5:00pm ET. 

Cap IQ Consensus estimates Q3 EPS of $1.28 (vs. $1.09 in 3Q16), w/revs of $9.84 bln (+40.4% y/y). 

Guidance

On the Q1 earnings call FB provided the following guidance: 

  • Tightening FY17 Expense Guidance to 40-45% y/y from 40-50%
  • CapEx will be at the lower end of prior range of $7.0-7.5 bln.Options Activity

Based on FB options, the current implied volatility stands at ~ 30%, which is 33% higher than historical volatility (over the past 30 days). Based on the Weekly Nov03 FB $185 straddle, the options market is currently pricing in a move of ~5% in either direction by weekly expiration (Friday).

TECHS:

 In response to earnings, the path of least resistance is to the upside as "everyone is a winner" with demand remaining strong for the stock. If earnings disappoint, expect profit-taking/selling pressures to kick in, contesting support first along that recent 175-breakout zone.

RESULTS

  • Reports Q3 (Sep) earnings of $1.59 per share, $0.31 better than the Capital IQ Consensus of $1.28; revenues rose 47.3% year/year to $10.33 bln vs the $9.84 bln Capital IQ Consensus. Ad rev +49% to $10.1 bln. Mobile advertising revenue -- Mobile advertising revenue represented ~88% of advertising revenue for the third quarter of 2017, up from ~84% of advertising revenue in the third quarter of 2016.
  • Daily active users (DAUs) -- DAUs were 1.37 billion on average for September 2017, an increase of 16% year-over-year. 
  • Monthly active users (MAUs) -- MAUs were 2.07 billion as of September 30, 2017, an increase of 16% year-over-year. 
  • Cash and cash equivalents and marketable securities -- Cash and cash equivalents and marketable securities were $38.29 billion at the end of the third quarter of 2017.