Facebook shares soar on earnings, mobile gains

• Facebook shares soar 19% on third-quarter earnings surprise
• Investors encouraged company is finding ways to get mobile ad profit
• Big question is how stock's jump will affect employees who can sell shares

Facebook shares soared Wednesday after the company's earnings report showed it's making progress turning its mobile users into profits.

Shares of the No. 1 social networking company ended up $3.73, or 19%, to $23.23 as investors parsed the third-quarter earnings report released late Tuesday. The stock had been as high as $24.25 a share in trading Wednesday.

Facebook (FB) topped earnings expectations after adjusting for special charges, by reporting earnings per share of 12 cents, topping estimates by a penny a share. The company's revenue also came in 32% higher at $1.3 billion.

Analysts were especially keen on Facebook's revelation it got 14% of revenue from mobile advertising. The fear that Facebook wouldn't be able to capitalize on the growing number of users who access the site on mobile devices has plagued the stock since it went public in May at $38 a share.

"Strong mobile performance in" the third quarter "should help alleviate some of the concerns surrounding the mobile transition for Facebook," wrote Arvind Bhatia, analyst at Sterne Agee, in a note to clients, where he boosted his estimates for the company's profits for 2013 by 1.6% and rated the stock a "buy."

But Facebook's troubles are far from over. Facebook showed weakness in its payments business, in large part due to struggles at online game company, Zynga.

Even more pressing, though, is a lockup expiration of 234 million shares on Monday, allowing many employees, for the first time, to sell, says Michael Pachter, analyst at Wedbush, in a note to clients, where he rates the stock "outperform." "Lock-up expiration over the next three weeks may negatively impact share price due to oversupply," he says.