Facebook’s overall revenue growth of 52 percent blew past estimates. China only came up once on the call, but it was all investors needed to hear.
“We’re also pleased with the growth we’re seeing in emerging markets in countries like China, where businesses are advertising on Facebook and Instagram to reach people internationally,” Chief Operating OfficerSheryl Sandberg said.
The stock soared 16 percent.
Neither Amazon.com nor Microsoft had much to say about China on their calls on Thursday, though Microsoft took a significant earnings hit due to the strength of the dollar. Alphabet reports results on Monday and shouldn’t be terribly hurt by China since the Google search engine isn’t available there.
The hope — and expectation — among tech executives is that we’re just experiencing a blip on a long-term upward slope. The International Monetary Fund still forecasts Chinese expansion of 6.3 percent in 2016, following 6.8 percent growth in 2015.
Or as Apple’s CEO spelled out to his investors:
“The middle class in China was less than 50 million people in 2010, and by 2020 it’s projected to be about 0.5 billion,” Cook said. “We think this provides us a great opportunity to win over some of those customers into the Apple ecosystem.”