Social media giant Facebook reported higher earnings & revenue than expected, due to the higher number of advertisers. Facebook’s user growth was as per expectations. Earnings stood at $1.99 a share compared to $1.88 predicted by Refinitiv. DAU figures stood at 1.59 billion, as per expectations. Revenue was at $16.9 billion compared to $16.5 billion predicted by Refinitiv. Average revenue stood at $7.05 per user, compared to $6.87 predicted by FactSet. MAU stood at 2.41 billion, as per expectations.
Wednesday saw Facebook reaching a settlement with FTC, valued at $5 billion, which was due to the 2018 CA scandal that allowed improper access to data of over 87 million users. Tuesday saw DoJ members announce an antitrust review process for all leading tech platforms.
Zuckerberg affirmed the need for regulatory frameworks. He said that without one, current frustration would only grow.
$3 billion had already been set aside for paying the fine. Another $2 billion charge will now be recorded as well. Facebook is also enhancing oversight and improving its privacy policies. CFO Wehner said that the new efforts need significant investments in technical infrastructure, compliance processes and people. Resources would also have to be reallocated, affecting product development.
The FTC informed Facebook regarding its antitrust investigation in June. Its business is now rapidly growing, with revenue increasing by 28% when compared to last year. Capital expenditure predictions have been lowered to between $16 billion and $18 billion. Facebook has over 2.7 billion monthly users when all its apps are considered. The European user base is relatively the same at 286M DAU. However, American and Canadian users increased by 1M. Average revenue figures per user have also increased by 18% compared to last year.
Zuckerberg’s Facebook is moving from its New Feed based ads to Stories based ads. Over 500M people use this feature across Messenger, WhatsApp, Instagram, and Facebook.
COO Sandberg stated that the Stories feature was presenting a huge opportunity. Zuckerberg has announced that Facebook would be turning into an encrypted, private service. WhatsApp, Instagram, and Messenger messaging services would be integrated soon as well. Facebook’s shares have risen by 56% this year.
Edward Ordway, with a BSc (Hons) Business & Management degree, is been working as a Senior Content Writer for 3 years in our organization. He is given the accountability to write articles and blogs associated with the world of Business, comprising deals & agreements, mergers & acquisitions, cryptocurrency, stock market, and other trending topics. Edward, in free time, travel around to new places and share the experiences through his personal blog.