Despite scandal, Facebook user numbers go up
Facebook said monthly active users in the first quarter rose to 2.2 billion, up 13 per cent from a year earlier …. … but warned that user numbers in Europe may stay flat or go down next quarter, as tough new privacy rules take effect in the EU. Q1 revenue
Despite ongoing privacy concerns and mounting scrutiny from regulators around the world, Facebook reported Wednesday that their active user metrics actually went up by 13 per cent year-over-year in the first quarter of 2018.
The social network giant reported an average of 1.45 billion daily active users, and 2.2 billion monthly active users for March. But at the same time, Facebook flagged the potential for user declines in Europe as a result of tough new privacy regulations in the E.U.
Speaking to analysts, CEO Mark Zuckerberg talked about a lot of the same things he told the U.S. Congress and journalists at various times over the past month. The earnings call was peppered with references to the importance of data privacy and Facebook’s social responsibility, but Zuckerberg also made comments that made it sound like he’s trying to move past the scandal.
“Overall 2018 is a year of important investments, to keep people safe and also to keep building the experiences people expect from us,” Zuckerberg said.
“We’re taking a broader view of our responsibility and investing to make sure our tools are used for good, and we also need to keep moving forward.”
The company has been in crisis mode since media outlets reported on a data breach that involved personal data from 87 million Facebook users, including 620,000 Canadians.
The user information was sold to Cambridge Analytica, a British company that reportedly used the data to make psychological profiles of users in an effort to influence the U.S. presidential election of Donald Trump.
In the wake of the scandal, some advertisers publicly announced that they’re abandoning the platform, and some users talked about scaling back their time on Facebook, or deleting their accounts altogether.
Because the Cambridge Analytica story broke on March 18, Wednesday’s numbers might not be fully reflective of the fallout of the scandal. But at the same time, Facebook chief operating officer Sheryl Sandberg played down the significance of the advertiser backlash.
“We heard from a handful of advertisers who paused spend — one of whom has already come back — and we haven’t seen a meaningful trend or anything much since then,” Sandberg said.
On the face of it, the numbers painted a cheerful picture of the company. Revenue went up by 49 per cent year-over-year to US$11.9 billion, while costs and expenses went up by 39 per cent to US$6.5 billion for the quarter.
Facebook CFO David Wehner said that as the European General Data Protection Regulation (GDPR) comes into force on May 25, it will likely affect daily active users (DAU) and monthly active users (MAU).
“We believe that European MAU and DAU may be flat to slightly down sequentially in Q2 as a result of the GDPR rollout,” Wehner said.
Sandberg said that Facebook will be giving all the same tools and controls to all Facebook users, regardless of whether they live in Europe or not.
When asked by an analyst about why the social network is expecting stagnant or shrinking user numbers in Europe, but not the rest of the world, Sandberg hinted that European users might have a slightly different user experience.
“We’re going to make all the same controls and settings available everywhere,” Sandberg said. “It’s not going to be exactly the same format. It’s going to be localized, instead, for different parts of the world, and so we think some of the differences will come from that.”
Facebook shares traded up 4.6 per cent at US$167, paring a month-long decline that began with Facebook’s disclosure about Cambridge Analytica.