It might not take long for the Facebook, Inc. Common Stock (NASDAQ: FB) share price to retest its record high after it posted a better than expected quarterly result.
Shares in the social media giant surged 9.8% in after hours trade to US$213.30, and this is on top of the 6.2% increase during the normal trading session on the NASDAQ.
Facebook shares are less than 5% below its record high of US$223.23 that it struck on 29 January this year.
Isolation driving demand
The lockdown due to the COVID-19 pandemic is driving a surge in usage of its platform and March quarter sales jumped 18% to US$17.74 billion ($27.1 billion) over the same time last year.
That's ahead of consensus expectations of US$17.48 billion, according to Business Insider.
The need to stay in touch with friends and family during social restrictions is prompting more people to use Facebook's apps, including WhatsApp and Instagram, for longer.
Monthly active users jumped 10% over the period to 2.6 billion while daily active users increased 11% to 1.73 billion.
Facing off the coronavirus
What will also please investors is that the business is holding up well during these trying times. While Facebook reported a drop in advertising revenue, its better than expected numbers shows it's well placed to ride out the global crisis.
Management also provided an update for the current quarter, a move that breaks with tradition. Facebook said advertising revenue in the first three weeks of April are about flat from the same period in 2019.
Two other tech darlings, iPhone maker Apple Inc. (NASDAQ: AAPL) and Google's owner Alphabet Inc Class A (NASDAQ: GOOGL), are also showing resilience to what may be the worst recession in living memory.
Foolish takeaway
The question facing Facebook shareholders is whether growth will stall even in the post-coronavirus world due to the expected surge in business closures and regulatory threats in countries like Australia.
Our competition watchdog is drafting policies that will force Facebook and Google to pay for content created by news organisations. Other countries are likely to follow suit.
Nonetheless, these headwinds are unlikely to end investors' love affair with tech stocks. The love is spilling over to the ASX as well.
Our WAAAX cohort of tech darlings – with the exception of WiseTech Global Ltd (ASX: WTC) – have outperformed the S&P/ASX 200 Index (Index:^AXJO) during the coronavirus wipe-out.
The stocks in this group also includes Afterpay Ltd (ASX: APT), Altium Limited (ASX: ALU), Appen Ltd (ASX: APX) and Xero Limited (ASX: XRO).
