Facebook’s (FB, Financial) first quarter 2021 revenues grew an astonishing +48% (constant currency), compared to +18% growth from a year ago. Unlike Alphabet, Facebook continues to grow expenses at an exceptionally robust rate, growing headcount +26% more recently. Facebook has pulled forward several years of investment during the past few years and has had a particular focus on content curation capabilities with the goal of making its platforms safer and more accessible for brands and users. The Company should be able to increasingly automate these functions as its heavy investments in artificial intelligence, especially machine learning, yield productivity benefits. The stock continues to trade at a meaningful discount compared to other companies that are growing revenues this quickly and finished the quarter as our second largest weighting.
From David Rolfe (Trades, Portfolio)'s Wedgewood Partners second-quarter 2021 shareholder letter.
