Facebook Earnings Preview: It's All About Mobile, User Engagment

Facebook (FB) may soon find out how many friends it has on Wall Street.

The social networking giant reports first quarter earnings after today's closing bell and it's likely to show strong growth in several key areas.

Its profit is expected to be pretty much flat with a year ago, as the company continues to spend heavily on a new data facility, new products and features, and new employees. So investors are focused on revenue growth.

The consensus of analysts surveyed by FactSet calls for revenue to jump 36 percent to more than $1.4 billion dollars.

And it's not just revenue that will be of interest, but where that revenue is coming from. Because more and more users are accessing Facebook through smartphones and tablets, the key metric in today's report could be revenue from mobile advertising.

A year ago, mobile revenue was barely a factor. But now it's all about mobile. Revenue in that category topped $300 million in the fourth quarter, and analysts are forecasting significant growth from that level: Last month the company introduced Facebook Home, the new software that puts the social-networking site front and center for some Android-based phones.

Another key measure to watch in today's report is the number of active daily users. There's been some worry that Facebook has lost some of its 'cool' factor -- that users are becoming bored and not visiting the site quite as often, and not spending as much time on it as they used to.

It was just about a year ago that Facebook launched its disastrous IPO, which was plagued by a major technical snafu at the Nasdaq. The stock plunged in value.

In the first few months of trading, Facebook tumbled from an initial price of $38 a share to as low as $17. Right now it's trading above $27, after gaining ground for the past eight days.

The price to earnings ratio on the stock is astronomical, but some analysts say the stock does offer opportunities for investors who can tolerate a lot of risk. They note that Facebook is still a very young company, with $1.1 billion users and lots of potential.

–Produced by Drew Trachtenberg

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