The market, however, is in no mood to see the glass as half full. Shares are down 10 percent after hours, falling to an historic low, after taking an 8.5 percent haircut in the regular session.
As of Thursday’s close, Facebook shares are down 29% from the $38 IPO price in May.
That's as it should be, according to Sam Hamadeh, CEO of PrivCo, an independent stock analyst in New York City.
Expectations for this earnings report were set artificially low by analysts who were involved in underwriting Facebook's IPO, Hamadeh said. By his calculations, an average of the earnings and revenue predictions by only unbiased analysts would have been more like 1.25 billion. By that benchmark, the company fell short. "It was definitely a miss, there is no question," he said.
He said Bay Area residents should not pin their economic hopes for the future on Facebook. Instead they should look to less glamorous companies with hot prospects.
He mentioned Palo Alto Networks, a network firewall maker, whose stock is selling above its July 20 IPO value, and Workday, a Pleasanton maker of business management software, with apparently bright prospects for an upcoming IPO.
To redeem itself Facebook will have to develop better aps for mobile devices, and do it fast, said Hamadeh. Perhaps the company should follow Google's example in acquiring a smartphone operating system.
In the earnings call, Facebook CEO Mark Zuckerberg and other exectives said they've got mobile devices covered. "Facebook is the most used ap on basically every mobile platform," he said.
The number of the company's mobile monthly active users has increased from 325 million in the second quarter of last year to 543 million in the second quarter of this year. By comparison, the total number of monthly active users on all platforms increased from 845 million to 955 million in that time.
And the company is working hard to make advertising more effective on those mobile aps, said Zuckerberg.
The company is emphasizing "social advertising," particularly "sponsored stories" in the company's news feed feature. For example, if your friend posts an update about buying something at Walmart, Walmart can pay to increase the likelihood that you will see your friend's update about that shopping experience.
Such ads bring in better returns on the investment than conventional advertising because users trust their friends' recommendations, Zuckerberg said.
In the first official update of its status as a publicly traded company, Facebook reassured investors that it is, in fact, making money. It even beat analysts' expectations on revenue by a hair.