Jan 29, 2020
Facebook: Privacy scandals take toll on profits
Facebook has recorded its first annual fall in profits in at least five years, as its efforts to respond to privacy and content concerns took a toll on firm's bottom line. Facebook startled investors in 2018, when it warned that its efforts to beef up privacy protections and content moderation on its platform would hit profit. Facebook alone counted an average of 1.7 billion active users each day during the month, up 9%. "Despite all of the concerns that have been swirling around the company in the past two years, it beat expectations on revenue, and it demonstrated continued growth in its user base," said Debra Aho Williamson, analyst at eMarketer. The firm estimates that Facebook attracted more than 20% of digital advertising spending globally last year. Expenses rose faster, increasing 51% year-on-year $46.7bn. In July, US regulators announced a record $5bn fine against Facebook to settle privacy concerns.
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