Citi Says Facebook Has Hit An 'Air Pocket'

Mark Zuckerberg

Photo: Justin Sullivan / Getty Images

Citi analyst Mark Mahaney says Facebook has hit an “air pocket,” and he thinks his Wall Street peers’ estimates for revenues “may be a tad high.”Just like when an aeroplane hits a pocket of air and suddenly, but temporarily drops, Facebook’s business is in a similar position.

Facebook reports third-quarter earnings tomorrow.

In a report he just issued, Mahaney maintained a neutral rating on the stock, albeit with a $35 target.

Google’s results were hit by weaknesses in mobile and in Europe, Mahaney notes.

Facebook’s’ high exposure to these two areas could put Street estimates somewhat at risk.

Mobile monetization efforts are early, and while early engagement numbers give reason for optimism, Facebook needs to show how mobile is hitting the bottom line.

NOW WATCH: Tech Insider videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.