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Nov 3, 2016 @ 11:34

Facebook Projects Greater Costs, Slowdown in Ad Sales Growth

 

Facebook Inc. reported a quarter that blew past expectations. But its shares fell in extended trading after executives suggested they won’t be able to repeat the performance.

The company’s shares declined as much as 8.5 percent Wednesday after two sobering comments on its conference call. First, Chief Financial Officer David Wehner said revenue growth rates will come down “meaningfully” next year, because the company won’t keep increasing the percentage of ads that Facebook users see in their news feed. Second, capital expenditures will rise “substantially” in 2017 as the social network works to build data centers and recruit the best engineers, he said.

“As we slow ad load growth, we’re going to have a slowing of revenue as well,” Wehner said. “it’s been one of the key factors in terms of driving growth.”

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