Facebook crushes expectations, stock soars

• Jillian D'Onfro
 
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• 18h
• 20,710
 
• 18

David Ramos/Getty ImagesFacebook CEO Mark Zuckerberg.

Facebook-A  $119.29

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Facebook reported its Q1 earningson Wednesday afternoon, beating expectations on the top and bottom lines.

The stock surged nearly 9% after-hours.

Here are the most important numbers:

• Earnings per share:$0.77 vs. $0.62 expected.
• Revenue: $5.38 billion vs. $5.25 billion expected, and up 52% year-over-year. Ad revenue is up 57% year-over-year.
• Monthly active users:1.65 billion vs. 1.62 billion expected.
• Daily active users: 1.09 billion on average forMarch 2016. This quarter, 66% of Facebook's monthly active users (MAU) were daily active users, which is up from 65% during the same period last year.

Along with strong growth across the board on those key numbers, Facebook also once again proved that its mobile business is thriving. It had 1.51 billionmobile MAUs, up 21% year-over-year, and the company made 82% of its advertising revenue from mobile this quarter, versus 73% at this time last year.

There are 894 million monthly active users who check only Facebook on their smartphones. On the company's earnings call, CEO Mark Zuckerberg said that people spend on average more than 50 minutes a day across its suite of apps, excluding WhatsApp. In regards to WhatsApp, he also said that it plans to focus on "growth and engagement" instead of diving into sponsored posts like Messenger has.

Outside of ad revenues, Facebook makes a small amount of money from payments and other fees: $181 million this quarter, which is down 20% year-over-year — the company has previously attributed this decline to a drop in revenue from gaming apps.

The company is also proposing a new class of nonvoting stock to make sure that Zuckerberg retains majority control:

If the proposal is approved, we intend to issue two shares of Class C capital stock as a one-time stock dividend in respect of each outstanding share of our Class A and Class B common stock. This proposal is designed to create a capital structure that will, among other things, allow us to remain focused on Mr. Zuckerberg's long-term vision for our company and encourage Mr. Zuckerberg to remain in an active leadership role at Facebook.

Here are the other important numbers:

• Total costs and expenses were $3.37 billion, up 29% year-over-year, and capital expenditures were $1.13 billion.
• Free cash flow for the first quarter of 2016 was $1.85 billion.
• Facebook has 13,600 employees, up 35% from the same time last year.
• Most of Facebook's revenue comes from North America and Europe with about only 24% ($1.3 billion) coming from Asia-Pacific and the rest of the world. But those areas account for 66% of its monthly active users. The average revenue per user in those regions is still tiny, compared to in the US: $1.56 and $0.91, respectively, versus $12.43 and $3.98 in the US and Europe.

Here's a look at where Facebook's revenue comes from geographically:

Facebook

Facebook's blockbuster earnings follow a week of disappointing results from the likes of Google, Apple, and Microsoft.

Here are the highlights from the company's call:

Zuckerberg started out by discussing the company's proposed new stock structure. He recalled how having founder control protected Facebook from selling in the early days and allowed it to buy Instagram. With the new structure, he'll be able to keep all of his power while still giving away $1 billion in shares per year.

Video was also a hot topic on the call. Facebook COO Sheryl Sandberg said that people are sharing and creating three times as much more video on the social network year-over-year, and that they're watching 40% more on Instagram in the last six months.

More generally, we also learned that Facebook's average price per ad increased 5% and impressions increased 50%.

Although the company has started rolling out ads on Messenger, it doesn't plan on doing the same for its other chat app, WhatsApp, just yet.

SEE ALSO: You could start ads in Facebook Messenger based on the websites you visit

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Abbott Labs is buying St. Jude Medical for $25 billion

• Akin Oyedele
 
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• 3h
• 5,377

Fabrizio Bensch/Reuters

Abbott Laboratories has agreed to buy St. Jude Medical for $25 billion, which will create a juggernaut in the market for heart devices.

St. Jude Medical shareholders will receive $46.75 in cash and 0.8708 shares of Abbott common stock, representing about $85 a share.

The companies already had a partnership selling cardiovascular products to hospitals. According to Bloomberg, makers of medical devices are merging to get better technologies and have stronger bargaining power with hospitals pushing for lower prices.

"St. Jude Medical's strong positions in heart failure devices, atrial fibrillation, and cardiac rhythm management complement Abbott's leading positions in coronary intervention and transcatheter mitral repair," the statement said.

"Together, the company will compete in nearly every area of the cardiovascular market and hold the No. 1 or 2 positions across large and high-growth cardiovascular device markets."

The deal is expected to close in the fourth quarter of this year if St. Jude Medical shareholders approve and certain regulatory hurdles are cleared.

Abbott will own or refinance the nearly $5.7 billion in debt that St. Jude has, and it plans to fund the cash portion of the deal with medium- and long-term debt.

There will be annual pretax synergies of $500 million by 2020, the companies said.

St. Jude shares jumped 28% in premarket trading, while Abbott shares fell nearly 4%.

Evercore is Abbott's lead financial adviser with Bank of America Merrill Lynch, who will also provide financing. Guggenheim Securities is advising St. Jude Medical.

SEE ALSO: Here are the best ways to reap huge returns when stocks are going nowhere

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The head of TED says this is the first thing you should do when public speaking

• Chris Weller, Tech Insider

• 15h
• 13,828

YouTube/TED

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As a the head curator for TED, the global nonprofit famous for its insightful talks, Chris Anderson knows a thing or two about what a successful TED talk looks like.

And all the best ones, he says, begin with eye contact.

"At TED, our number-one advice to speakers on the day of their talk is to make regular eye contact with members of the audience," Anderson writes in his new book. "Be warm. Be real. Be you."

Anderson is the author of the upcoming book "TED Talks: The Official TED Guide to Public Speaking," a step-by-step instruction manual for putting on a great talk. His first piece of wisdom, aside from telling you why TED talks are so great and warning which kinds you should avoid giving, is to connect.

"Great speakers find a way of making an early connection with their audience," he writes. "It can be as simple as walking confidently on stage, looking around, making eye contact with two or three people, and smiling."

Anderson points to Kelly McGonigal's talk about stress,Raghava KK's talk about life as an artist, and Pia Mancini's talk about democracy as examples of successful TED talks that reinforce the importance of eye contact. Whether it's a warm, open form of eye contact or a hard, lingering gaze, Anderson believes the connections we make begin with our eyes.

"There's a reason for this," he says. "Humans have evolved a sophisticated ability to read other people by looking at their eyes."

It's true, we have.

One experiment involving Rhesus macaques led to the discovery of new so-called "eye cells," or neurons, in the monkeys' amygdalae. Out of 151 neurons being tested, 23 of those neurons only fired when the monkeys made eye contact with a monkey in a test video. 

"These are cells that have been tuned by evolution to look at the eye, and they extract information about who you are, and most importantly, are you making eye contact with me," Katalin Gothard, the lead researcher and University of Arizona neurophysiologist, told New Scientist.

If someone gets on stage and stares at the floor the whole time, the audience has no choice but to remain distant — even imperceptibly. Only the speakers that engage the audience themselves are able to create that crucial connection.

"When you walk onto the stage, you should be thinking about one thing: your true excitement at the chance to share your passion with the people sitting right there a few feet from you," Anderson writes. 

There's no need to rush into the speech you've prepared for hours on end. Soak up the moment. But look at who you're speaking to first.

Read the original article on Tech Insider. Follow Tech Insider on Facebook and Twitter. Copyright 2016.

Chipotle just said it will break one of its cardinal rules to win back customers

• Hayley Peterson
 

• 16h
• 90,776
 
• 33

Facebook/Chipotle

Chipotle is considering adding new menu items to win back customers as sales plunge in the wake of E. coli outbreaks that affected restaurants across the country.

One of the first items that Chipotle could add is chorizo, a spicy pork and chicken blend, Chipotle executives said on a call with analysts on Tuesday.

The company is hoping that chorizo and other new menu additions will draw back its most loyal customers.

A test of chorizo in Kansas City last year was "very, very popular with our loyal customers," Chipotle co-CEO Monty Moran said. The company is hoping that the addition of chorizo will "make our loyal customers come more often," he said.

Chipotle's revenue dropped 23.4% to $834.5 million in the first quarter, the company reported on Tuesday. Same-store sales dropped nearly 30%.

The decision to add menu items goes against one of Chipotle's core business strategies.

The company has deliberately left its menu virtually unchanged since it was founded more than two decades ago. The only major change in the past 23 years has been the addition of tofu sofritas in 2014.

The chain prides itself on the simplicity of its menu and boasts that customers can create thousands of combinations from the ingredients offered.

"Chipotle restaurants serve only a few things: burritos, burrito bowls, tacos and salads," the company wrote in its 2014 annual report. "But because customers can choose from four different meats or tofu, two types of beans and a variety of extras such as salsas, guacamole, cheese and lettuce, there's enough variety to extend our menu to provide countless choices."

Chipotle co-CEO Steve Ells said that the company is being mindful of keeping things simple with the addition of new menu items.

"When we think about adding something to Chipotle, we are very, very mindful of our overall efficiencies in the kitchen, in cooking, in throughout and in ease of ordering for the customer," Ells said.

SEE ALSO: Former NBA star Ray Allen is opening a fast-food restaurant that's unlike anything on the East Coast

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Twitter's stock plunges on revenue miss

• Alexei Oreskovic
 
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• 18h
• 12,730
 
• 20

REUTERS/Lucas JacksonTwitter CEO Jack Dorsey.

Twitter  $15.00

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Twitter's stock is tanking after the internet company reported Q1 revenue that missed Wall Street targets and offered a forecast for the current quarter that was far below expectations.

Here are the key numbers:

• Q1 revenue: $595 million, up 36% year-on-year, but below the average analyst expectation of $607.8 million.
• Earnings per share (adjusted): $0.15 vs. the average analyst expectation of $0.10.
• Monthly users: 310 million, up from 305 million at the end of 2015.
• Q2 revenue guidance: $590 million to $610 million, compared to the average analyst expectation of $677.6 million.

Twitter's stock is down roughly 14% at $15.33 in after-hours trading.

The company's weak quarterly results highlight the struggles facing the money-losing company, which is trying to revive its fortunes under the stewardship of cofounder Jack Dorsey. He retook the CEO reins last year, but investors have continue to punish the stock, which has crumbled from its 52-week high of $52.22.

Twitter said that Q1 revenue came in at the low end of its forecast because brand marketers who advertise on its social network "did not increase spend as quickly as expected."

While revenue from video ads on Twitter nearly tripled year-on-year, the company noted that spending on video cannibalized some of the spending that marketers previously spent on other types of ads on its service. In other words, Twitter is not attracting new advertising money, but simply shifting where the money is spent.

Twitter's number of total monthly users returned to growth, after shrinking in Q4, although the growth was anemic — all the growth was international, while user growth in the US remained stalled. Here's a chart that Twitter provided showing its user growth:

Twitter

As the chart shows, Twitter's audience of monthly users has basically stagnated for the past year, even as rivals such as Facebook, Instagram, and Snapchat are growing fast.

Twitter said that changes to its timeline helped boost in user engagement during the quarter, with retweets, replies, and likes increasing. Direct messages were up 50% year-on-year, Twitter said.

The company continued to lose money in the first quarter, posting a net loss of $80 million. That's less than the $162.4 million that it lost in the year-ago period.

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Comcast is reportedly in talks to acquire DreamWorks Animation in a multibillion deal

• Bryan Logan
 
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• 11h
• 3,871
 
• 3

Alberto E. Rodriguez/Getty ImagesActress Lucy Liu and Dreamworks Animation CEO Jeffrey Katzenberg attend the premiere of DreamWorks Animation and Twentieth Century Fox's 'Kung Fu Panda 3' at TCL Chinese Theatre on January 16, 2016 in Hollywood, California.

Comcast is reportedly in talks to acquire DreamWorks Animation for $3 billion, The Wall Street Journal reported, citing sources familiar with the matter.

DreamWorks is the animated film house behind blockbuster movies like "Kung-Fu Panda" and "Shrek," and headed by CEO Jeffrey Katzenberg.

The Journal notes that DreamWorks Animation's market value currently sits at $2.3 billion, making the projected $3 billion deal a potential boon for DreamWorks.

The film studio, Universal Pictures, also sits under Comcast's umbrella. Universal has its own animated film branch in Illumination Entertainment.

It's not clear whether Katzenberg will stay with the company should the deal go through.

Katzenberg's compensation more than doubled last year to about $13.5 million, The Hollywood Reporter's Paul Bond said last week. $2.5 million of that was salary, the rest was a mix of DreamWorks stock awards and money earned through a nonequity incentive plan.

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