By Benjamin Pimentel

SAN FRANCISCO (MarketWatch) — Facebook Inc. reported gains in adjusted earnings and revenues on Wednesday that beat Wall Street’s expectations, again pointing to solid traction in its mobile-advertising business.

But the social network’s shares slipped more than 4% in after-hours trades. One analyst said some investors were expecting a “blowout” report that didn’t materialize, while the company itself broadcast plans to spend heavily in the coming year on recruiting talent to build up its business.

Facebook  closed the regular session up 1.5% at $31.24. The stock has surged more than 60% since its last earnings report.

“I’m surprised the stock is off at all,” Wedbush analyst Michael Pachter told MarketWatch. “Every metric, except maybe spending, looks good.”

The company reported a fourth-quarter profit of $64 million, 3 cents share, compared with a profit of $205 million or 14 cents a share for the year-earlier period. Revenue rose to $1.59 billion from $1.13 billion. Adjusted profit was 17 cents a share.

Analysts polled by FactSet on average saw the Menlo Park, Calif.-based company reporting a profit of 15 cents a share on revenue of $1.51 billion.

Facebook said its mobile revenue now makes up 23% of advertising revenue, topping last quarter’s share of 14%. Some analysts were expecting a higher share for mobile revenues. Topeka Capital’s Victor Anthony projected 24%, while Aaron Kessler at Raymond James said he was looking for mobile revenue to be up to 26%.

Anthony told MarketWatch that the company’s results did not match the more elevated expectations. “Not a blowout that some were expecting, but a good solid beat versus expectations,” he said.

Robert W. Baird analyst Colin Sebastian also speculated that the market reaction may have been “sell on the news, following all of the analyst upgrades lately.”

He also said the “top line might have been a little shy of whisper numbers. But on a fundamental level, it was a solid quarter — revenue growth accelerated.”

Whisper expectations were also a factor, with some investors projecting earnings of 17 cents of share, which was in line with what Facebook reported. The official consensus Wall Street number was at 15 cents a share.

Cantor Fitzgerald analyst Youssef Squali also called Facebook’s results “solid” and said they “slightly exceeded consensus expectations on virtually every metric.”

In the company’s conference call, CEO Mark Zuckerberg declared, “There’s no argument — Facebook is a mobile company.” The company said its mobile active users exceeded its desktop daily users for the first time in the fourth quarter of 2012, highlighting its momentum in that arena.

Facebook said it had a total of 1.1 billion monthly active users, up 25% year-over-year.

The company said it expects expenses to grow about 50% in 2013 as it focuses on building its business. Zuckerberg said the company is focused on building products, such as its newly-introduced “graph search.”

“Based on this, we made a decision to continue to grow head count quickly in 2013,” Zuckerberg said. “This will likely cause expenses to grow at faster rate than we expect to grow revenue this year, which means we aren’t operating to maximize our profit this year, but we’re doing what we think will build the best service and business over the long term. ”

He also said, “There’s lots of areas we need to invest them. We need to build the best mobile experiences build our platforms and build a really strong monetization engine.”

By MarketWatch

SAN FRANCISCO (MarketWatch) — Facebook Inc. Chief Executive Mark Zuckerberg kicked off the company’s earnings call on Thursday proclaiming that the social network “is a mobile company,” but investors may be more concerned about its spending plans.

Earlier in the afternoon, Facebook  reported better-than-expected fourth quarter earnings, with 23% of its advertising revenue coming from mobile. Shares slipped after the report, however, as some analysts said the numbers may have been below a “blow out” that some investors were expecting. Read: Facebook results beat Street, but shares slip.

On the call, Zuckerberg said that 2013 will be a year of “critical investment” and that it will continue to hire aggressively. Facebook CFO David Ebersman said that total expenses at Facebook, excluding stock compensation, will jump by about 50% in 2013.

When one analyst asked about how long the current investment cycle will last, Ebersman said, “That will moderate over time,” but added that he did not want to be too specific or miss out on any potential opportunities.

In addition, Zuckeberg said that the company’s latest new search product, called Graph Search, will take time before it starts to contribute meaningful revenue to Facebook. “Down the line, if we do this well, this could turn into a meaningful product for us,” Zuckerberg said.

Investors at least got some answers regarding mobile advertising, but hearing that Facebook is intensely focused on mobile did not seem to outweigh some additional concerns, especially concerns that Facebook could become like Google in the spending department.