Facebook keeps earning despite data privacy scandal

Facebook keeps earning despite data privacy scandal

San Francisco: Facebook on Thursday reported a sharp jump in profits in the past quarter, with gains in its user base and strong ad growth as the social network appeared to see no impact from a controversy on privacy.

Facebook said its daily active users had gone up 13 percent from a year ago to an average of 1.45 billion for March while its monthly active users had also risen 13 percent to 2.20 billion.

Mobile advertising revenue on the network represented about 91 per cent of ad revenue for Q1, up from around 85 per cent in Q1, 2017. Many users said they would delete their accounts, raising fears that the service was facing a major crisis. While the Facebook Chairman Mark Zuckerberg admitted that data of 5.62 lakh may have been used in an unauthorised manner, the Cambridge Analytica said that it does not have any Facebook data on Indian citizens.

The number of daily active users in Canada and the US - its most lucrative advertising demographic - rose by 100,000 from the previous quarter to 185 million. Facebook has 27,742 employees, up 48 per cent from past year.

British political consultancy firm Cambridge Analytica was found misusing users' data collected by a Facebook quiz app which used the "Login with Facebook" feature.

Facebook's shares rose 6.8 per cent in after-hours trading to US$170.56.

Facebook CEO Mark Zuckerberg recently testified at two Congressional hearings at which he fielded lawmakers' questions about the company's continued stumbles with data privacy and how it meant to prevent future disasters.

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However, "from now on", says the video, "Facebook will do more to keep you safe and protect your privacy". In a Wednesday report, Facebook FB posted $4.99 billion in quarterly profits on sales of $11.97 billion, topping analysts' average estimates of $4.01 billion for net income and $11.41 billion in revenue.

Chief Financial Officer David Wehner told analysts on a call that expenses this year would grow between 50 percent and 60 percent, up from a prior range of 45 percent to 60 percent.

"Facebook continues to have a long revenue runway ahead of it", Mark Mahaney, an analyst at RBC Capital Markets, said in a note to investors.

Sandberg rejected any suggestion that Facebook should diversify its business model away from micro-targeted advertising.

The Indian government on Wednesday, April 25, served another notice to Facebook and Cambridge Analytica after finding discrepancies in their statements over the data breach.

The Cambridge Analytica scandal, which has sparked government investigations globally, was mentioned only once on an hour-long conference call between analysts and Facebook management, when one analyst asked Zuckerberg what he learned from testifying in us congressional hearings.

Stoked by fears that the data may have been used to try and influence elections in the USA 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. "You know, I think in general technology is an increasingly important trend in the world and I actually think the question is more what's the right regulation rather than "yes" or "no" should it be regulated".

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