San Francisco - Wall Street is still not sure about Facebook.

After an eight-month roller-coaster ride on the public market, the company on Wednesday beat earnings expectations by aggressively ramping up targeted advertisements to its users, including on mobile phones. It reported fourth-quarter revenues of $1.59 billion, representing 40 percent growth. Analysts were looking for a 34 percent growth in revenue, to $1.52 billion in this quarter, according to analysts surveyed by Bloomberg.

Facebook earned $64 million in net income, or 3 cents a share. Excluding certain items, Facebook said it had a net income of $426 million in the fourth quarter, or 17 cents a share. Analysts had expected 15 cents a share.

But after the earnings report, the stock fell over 5 percent from Wednesday's closing price of $31.24, before recovering.

Most Facebook users log in on their cellphones, and so the most closely watched piece of the quarterly earnings was how much money the company brought in from its mobile users. It reported that advertising on the mobile newsfeed accounted for 23 percent of its advertising revenues, up from 14 percent in the third quarter of 2012; at the time Mark Zuckerberg, Facebook's chief executive, told analysts he wished to "dispel the myth" that the company can't profit in the mobile era.