Facebook ad revenues up year-on-year despite data and privacy scandals

Screen Shot 2018 04 25

Markets Insider

Facebook says its user base and and revenue increased significantly in the first three months of 2018, despite the setback caused by the Cambridge Analytica data breach scandal.

Facebook also added 48 million daily users; overall, the company boasts 1.45 billion daily active users-in line with Wall Street estimates and up 13 percent year-over-year-and nearly 2.2 billion monthly active users, beating estimates of 2.19 billion and also up 13 percent year-over-year. Many users said they would delete their accounts, raising fears that the service was facing a major crisis.

Changes to the Facebook news feed to prioritise posts from family and friends were also reflected in the quarter's data - though there was no specific update provided by the company regarding the time users spend on the site. Employee head count was up almost 50 per cent from the same period a year ago, to more than 27,700.

While a poll last month showed that Facebook's favorability plunged 28 points in the five months between October and March, on Wednesday, the company's stock price exploded more than 7 percent in after-hours trading.

The company, 4C, tracks $250 million in actual spending from more than 1,000 brands that use its tools to buy ads.

If users made a decision to restrict their data as much as possible on the platform, Ms Sandberg said it "would affect the product".

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On a conference call with analysts Wednesday, Zuckerberg stressed that he remains committed to the advertising business model that has powered Facebook so far even amid the data privacy backlash.

But Williamson said some of Facebook's momentum was already fading due to other factors such as disinformation, social media fatigue and new platforms attracting young people.

In the fresh notice, government has asked the social media giant to list out security architecture proposed to be created by the company "so that data concerning Indians are not pilfered or manipulated again for extraneous purposes including to influence the elections".

Net income for the first quarter came in at US$4.99 billion, or US$1.69 per share, compared with US$3.06 billion, or US$1.04 per share, a year earlier, Reuters reports. The government has also sought information about the entities working under CA along with the details of their directors.

In another sign public anger directed at Silicon Valley hasn't hurt business, Twitter and Alphabet, Google's parent company, also reported strong financial results this week. A handful of advertisers, including Mozilla, maker of internet browser Firefox, pulled their ads from Facebook.

Stoked by fears that the data may have been used to try and influence elections in the USA and Europe and the discovery that Facebook collects a lot more data than the average person realises (including web browsing history and, in some cases, text messages), some users have started a #DeleteFacebook movement, including the co-founder of the Facebook-owned WhatsApp. Zuckerberg spent two days on Capitol Hill earlier this month getting grilled by lawmakers about Facebook's responsibility.

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