24 Jul For now, Facebook is still crying all the way to the bank
For all the self-inflicted problems Facebook is dealing with—such as the $5 billion fine it must pay after an FTC investigation into its privacy practices—the news is usually good when it comes to its financial performance as a public company. That was true again on Wednesday as the company announced better-than-expected Q2 results. But Facebook’s release detailing its strong numbers also confirmed that the FTC has opened an investigation into the company over antitrust concerns.
After scandal after scandal, Facebook’s reputation may have taken a beating. However, any stigma has yet to drive away the brands that pay its bills. For the three months ending on June 30, the company reported $16.9B in revenue, which is up 28% over a year ago. 98% of that came from advertising sales, and 94% of those ads were displayed on the mobile incarnations of Facebook and Instagram.
The prospect of Facebook running out of new members to sign up for its services has long loomed as a potential growth killer, but it hasn’t happened yet. The company says that it has 1.59 billion daily average users, an increase of 8% over the year-ago quarter. Monthly average users have reached 2.41 billion, also an 8% bump.
In a section of the results announcement headed “Other Matters,” Facebook stated that the FTC informed it in June that it was the subject of an antitrust investigation. On Tuesday, the Justice Department also announced that it was conducting an antitrust probe against the nation’s largest online platforms—a group that unquestionably includes Facebook, though it wasn’t mentioned by name.
Despite the FTC fine and acknowledgement of new legal woes, Wall Street didn’t seem fazed by the day’s developments. In after-hours trading, Facebook’s stock was up by as much as 4%. It’s flat as of this writing.
Source: Fast Company