Facebook Earnings Beat Expectations

Aleksandr Kogan tells a UK parliamentary committee about his app used by Cambridge Analytica to mine Facebook data

Facebook shrugs off Cambridge Analytica scandal to post 1Q earnings beat

Facebook stock prices rose on Wednesday, after the social media giant announced in an earnings call it had added 70 million monthly users to its platform in the first three months of the year.

Analysts estimated that Facebook would report 1.45 billion daily active users the first three months of this year, compared with 1.4 billion the previous quarter.

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. Monthly active users totaled 2.2 billion and daily active users 1.45 billion, both meeting analysts' expectations of a 13 percent increase from a year ago.

"Despite facing important challenges, our community continues to grow".

Zuckerberg faced questioning in two congressional panels earlier this month about revelations that personal data on 87 million users was harvested by Cambridge Analytica, a consultancy working for Donald Trump's 2016 campaign.

In the hours following the release of the first-quarter numbers, company shares climbed more than 5.5 percent to $168.50. His firm holds about 73,000 shares in Facebook. It seems the company is trying to hide more than reveal.

Facebook in its reply recently admitted that an app in 2013 had illegally collected data of half a million Indians and sold it to Cambridge Analytica.

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On a conference call, chief financial officer David Wehner said the average monthly and daily user growth in Europe could be flat or down as the European Union brings tough new privacy regulations on May 25.

No matter the deteriorating public sentiment or concern about the company's reliance on mobile ads, businesses are shelling out increasing amounts of money to get their brands in front of the social network's users.

"Most are disturbed at an individual level with what happened, but there's nothing that made Facebook overly toxic - yet", he said. Its operating profit, $5.45 billion for the quarter, also beat estimates of $4.64 billion.

"Further, it remains to be seen whether or not the way in which attempts by Facebook (and everyone who sells digital advertising) to adhere to GDPR will withstand regulatory scrutiny and avoid significant related fines in Europe".

Facebook eventually suspended Cambridge Analytica, after the data scandal came to light in mid-March.

Stoked by fears that the data may have been used to try and influence elections in the U.S. 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.

Steps outlined by Zuckerberg to address these areas include restricting the data developers can access; building more artificial intelligence tools to detect and remove fake accounts ahead of elections in both the USA and Europe last year, and doubling the headcount working on security and content review to more than 20,000 by the end of this year.

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