Facebook Financial Statements and Financial Ratios

Meta (Facebook) Financial Statements and Financial Ratios Analyzed

Hey All,

Thanks for visiting my Meta (Facebook) Financial Report page. On this page, you will be able to find preliminary information about Meta's current financial performance as well as some historical track records and trends. 

For a more detailed examination of Meta's (Facebook)financial performance, I offer two reports, which are "A Beginner's Guide to Meta Financial Analysis" and "Meta Financial Report by Paul Borosky, MBA."  Both reports are written by myself, Paul Borosky, MBA., Doctoral Candidate, and published author, and include:

  • Summarized income statements for the last 5 years.
  • Summarized balance sheets for the last 5 years.
  • Five years’ worth of over twenty common financial ratios presented with formulas, calculations, and analysis tips for each ratio.
  • Line by line description, explanation, and analysis tip for most financial statement line items and financial ratios.
  • Professional financial analysis tips are provided in each section to help YOU conduct your OWN financial analysis!
  • Each section includes an “in other words” segment.  This is where I use plain English to explain concepts.

 

For a MORE in-depth review of the company's financial statements and ratios, make sure to buy my "Meta Financial Report".  The financial report includes all aspects of my "Beginner's Guide" plus a whole lot more...

  • Professional financial analysis of important income statements, balance sheets, and financial ratio trends.
  • "Letter Grade" is assigned to most financial statement line items and financial ratios to help you better understand their overall trends for the last 5 years (starting in 2021).
  • Overall financial analysis summary for the company.

Enjoy the preliminary information and for a more detailed analysis, buy the financial report!

Sincerely,

Paul, MBA.

PDF/Downloadable Versions

Facebook 2021 Beginner's Guide to Financial Analysis

Downloadable PDF Price: $9.99

Facebook Financial Report by Paul Borosky, MBA.

Downloadable PDF Price: $14.99

Sample Financial Report

Sample Financial Report by Paul Borosky, MBA.
Financial Report Sample 2

The Meta (Facebook) Brief Summary

Facebook stock price started in February of 2019 at $171.20.  It ended in January of 2020, with a stock price of $210.47.  This is a growth rate annually of 22.94%.  From an investor’s perspective, this growth rate well exceeds overall market returns.

Facebook has not paid out dividends in the last five years.  The zero dividend payment policy may be due to the company’s need for internal growth.  However, over the next several years, investors should expect some type of dividends to be paid once the organization reaches the mature phase of its business cycle.

The current executive team and compensation are as follows.

Executive Team
Executives Title Pay Amount
Mark Zuckerberg CEO 22.5 Million
David Wehner CFO 1.26 Million
Sheryl Sandberg COO 5.3 Million
Michael Schroepfer CTO 1.33 Million
Susan Taylor CAO N/A

Facebook Financial Report Sources

“Facebook 2019 Company Analysis: Financial Statements and Financial Ratios: Defined, Discussed, and Analyzed for 5 Years” was written by, Paul Borosky, MBA., and owner of Quality Business Plan.  In this book, the author selected Facebook's 2019 10k, 2017 10k annual report, 2016 10k annual report, 2015 10k annual report, and Facebook 2019 10k annual report as the basis for information gathering. 

 

 

 

Section 1: Facebook Income Statement Analyzed

In this section, I walk through a broad definition of what an income statement is and why it is important.  From this, I then discuss and define income statement line items, such as revenues, gross profits, etc. in detail.  After each line item is defined and discussed, I finally offer a summary analysis of Facebook’s important income statement line item trends from 2015 to 2019, in most cases.

Revenue Growth:  Facebook’s revenues started 2016 at approximately $18 billion.  In the next four years, revenues exploded to over $70.7 billion.  Annually, this is about a 41% growth rate.  This shows that the firm is in an expansion business cycle.  In these cycles, companies often forgo paying out dividends and reinvesting net profits back into the company to sustain the cycle.  However, once revenue growth starts to moderate, the firm should consider paying out dividends to supplement modest stock-price growth.

Meta (Facebook) 2021 Income Statement

Column1

2021

2020 2019 2018

2017

Revenues

                 117,929

                   85,965                    70,697                    55,838

                     40,653

COGS

                   22,649

                   16,692                    12,770                      9,355

                       5,454

Gross Profit

                   95,280

                   69,273                    57,927                    46,483

                     35,199

 
SG&A

                     9,829

                     6,564                    10,465                      3,451

                       2,517

Depreciation

                     7,967

                   66,862                      5,741                      4,315

                       3,723

R & D

                   24,655

                   18,447                    13,600                    10,273

                       7,754

Other
Total Operating Expenses

                   42,451

                   91,873                    29,806                    18,039

                     13,994

EBIT

                   46,753

                   32,671                    23,986                    24,913

                     20,203

Other Income                            -                            -                             -
Interest Expense

                       (531)

                       (509)                        (826)                        (448)

                        (391)

EBT

                   47,284

                   33,180                    24,812                    25,361

                     20,594

Taxes

                     7,914

                     4,034                      6,327                      3,249

                       4,660

Net Income

                  39,370

                  29,146                   18,485                   22,112

                   15,934

 

Section 2: Facebook Balance Sheet Analyzed

For Facebook's balance sheet, I again go through each important line item from the balance sheet.  In reviewing each line item, I will define Facebook’s balance sheet line item, such as cash, property, plant and equipment, and liabilities between 2015 to 2019.  Next, I then offer a summary analysis of Facebook’s important balance sheet line items.

Cash:    Facebook’s cash position has jumped from $4.9 billion in 2015 to $19 billion in 2019.  As a percentage of sales, this rate has not changed.  However, such a huge stockpile of cash shows that the firm is not fully exploiting short-term investment opportunities.  By keeping less money in cash and more funds in short-term investments, the organization may earn interest on invested funds.  As a result, this would lead to better utilization of the firm’s total assets available.

Short-term investments:  Facebook has been using short-term investments to assist with optimizing cash usage.  In 2015, their short-term investments were approximately $13.5 billion.  As of 2019, their short-term investments grew to $35.7 billion.  This shows that the company is continuing to move cash from operations to short-term investments.  A better strategy may be to divest some of the short-term investments to shareholders in the form of dividend payments.

Meta (Facebook) 2021 Summary Balance Sheet

Column1

2021

2020 2019 2018

2017

Cash

                     16,601

                 17,576                  19,079                  10,019

                   8,079

Short Term Investment

                     31,397

                 44,378                  35,776                  31,095

                 33,632

Account Receivable

                     14,039

                 11,335                    9,518                    7,587

                   5,832

Inventory
Other
Current Assets

                   66,666

               75,670                66,225                50,480

               48,563

Net PPE

                     57,809

                 45,633                  35,323                  24,683

                 13,721

Goodwill

                     19,197

                 19,050                  18,715                  18,301

                 18,221

Other
Total Assets

                 165,987

             159,316              133,376                97,334

               84,524

Accounts Payable

                       4,083

                   1,331                    1,363                       820

                      380

Accrued Expense

                     14,312

                 11,152                  11,735                    5,509

                   2,892

Accrued Taxes                         -
Notes Payable                         -
LT Debt - Current                         -
Other                         -
Total Current Liabilities

                     21,135

                 14,981                  15,053                    7,017

                   3,760

LT Debt
Other
Total Liabilities

                   41,108

               31,026                32,322                13,207

               10,177

Common Stock

                     55,811

                 50,018                  45,851                  42,906

                 40,584

Treasury                         -
Retained Earnings

                     69,761

                 77,345                  55,692                  41,981

                 33,990

Other
Total Equity

                 124,879

             128,290              101,054                84,127

               74,347

Total Equity & Liability

                 165,987

             159,316              133,376                97,334

               84,524

Section 3: Facebook Financial Ratios Analyzed

For this section, I have chosen several different financial ratios to review for Facebook from 2015 to 2019.  In reviewing each of Facebook’s financial ratios, I first start by defining the financial ratio.  Next, I supply the financial formula for calculating the specific ratio.  Finally, I offer a brief analysis of Facebook’s Important Financial ratios. 

Facebook Current Ratio

Facebook’s current ratio ended 2015 at 11.25.  In 2019, the current ratio dropped to 4.40.  This shows that the firm may be deviating some current assets to long-term assets for optimal asset exploitation.  Also, such a high current ratio shows that the firm will be solvent for the short term.  However, excess current assets often lead to underutilizing total assets.

Facebook Total Asset Turnover

The total asset turnover for Facebook was .36 in 2015.  The organization has continually improved its asset utilization to the point where total asset turnover is now .53.  As compared to mature industries, their asset utilization is quite low.  In other words, the company is not using its assets as efficiently as it should generate revenues.

Facebook Return on Assets

Facebook’s return on assets ended 2015 at 7.5%.  In the next five years, the company’s return on assets would grow to approximately 13.9%.  This shows that the firm is generating more revenues continuously as compared to total assets.  As technological advances continue, the firm should be able to significantly increase this ratio.

Facebook Debt to Equity Ratio

Again, the organization has no debt that we could find in our research.  From this, the debt to equity ratio would again be zero.

Facebook Liquidity Ratios 2019

Ratios 2019 2018 2017 2016 2015
Current Ratio                           4.40                    7.19
Cash Ratio                           1.27                    1.43
Quick Ratio                           4.40                    7.19
Net Working Capital                       15,499                11,277

Facebook Asset Utilization 2019

Ratios 2019 2018 2017 2016 2015
Total Asset Turnover                           0.53                    0.57
Fixed Asset Turnover                           2.00                    2.26
Days Sales Outstanding                         49.14                  49.59
Inventory Turnover #DIV/0! #DIV/0!
Accounts Receivable Turnover                           7.43                    7.36
Working Capital Turnover                           4.56                    4.95
AP Turnover                         51.87                  68.10
Average Days Inventory #DIV/0! #DIV/0!
Average Days Payable                           0.14                    0.19

Facebook Profitability Ratios 2019

Ratios 2019 2018 2017 2016 2015
Return on Assets 13.86% 22.72%
Return on Equity 18.29% 26.28%
Net Profit Margin 26.15% 39.60%
Gross Profit Margin 81.94% 83.25%
Operating Profit Margin 33.93% 44.62%
Basic Earning Power 17.98% 25.60%
ROCE 20.27% 27.58%
Capital Employed                     118,323                90,317
ROIC 35.16% 60.40%

Facebook Long-term Debt 2019

Ratios 2019 2018 2017 2016 2015
Debt Ratio 0.00% 0.00%
Debt/Equity 0.00% 0.00%
Times Interest Earned                       (29.04)                (55.61)