Facebook In-Line With Estimates, Investors Not Impressed

Facebook FB announced its second-quarter earnings today, reporting an EPS of $0.12, in-line with the $0.12 estimate. Revenues were $1.18 billion versus $1.15 billion, beating estimates by 2.6 percent. Facebook's positive (anticipated) results come at a time when the company is struggling to prove its value. The social networking giant was dealt a significant blow after General Motors GM announced in May that it would no longer advertise with Facebook. But in June, Ford F and Coca-Cola KO announced that they were satisified with Facebook's ability to get people talking about their particular brands. Facebook recently paid $20 million to settle a lawsuit involving the site's use of Sponsored Stories. Despite the outcry from users (whose comments and images were used without their consent), hundreds of millions of people return to the social network every single day. LinkedIn LNKD has attempted to cut into Facebook's profits and user base by redesigning the site. It is not yet known if this effort will be effective. Yesterday afternoon, Facebook shares dropped more than six percent after Zynga ZNGA reported lackluster second-quarter results. The stock continues to plummet today in after hours trading, dropping more than five percent. Follow me @LouisBedigianBZ