Facebook’s troubles appeared to be far from over, as the company predicted privacy-related changes to its platform will slow revenue growth and revealed it is the subject of another Federal Trade Commission (FTC) probe.
Revenue in Q2 jumped 28 per cent year-on-year to $16.9 billion, driven primarily by growth in advertising revenue. But CFO David Wehner warned momentum is expected to slow through the end of the year and into 2020, as the implementation of new data privacy protections across Facebook’s platforms limit ad targeting capabilities.
He added privacy restrictions will make the development of new products and services “more difficult and costly”.
The company is also facing another potentially major hurdle: though it just agreed to pay a $5 billion fine to settle an FTC inquiry into its privacy missteps, it quietly disclosed the Commission opened a separate antitrust investigation against it in June.
Executives did not comment directly on the new FTC probe, nor a Department of Justice investigation into anti-competitive practices among major tech platforms.
However, CEO Mark Zuckerberg (pictured) reiterated the company welcomes regulatory guidance on issues including privacy, preventing election interference, reducing harmful content and data portability.
“There’s work that we can do…[but] we believe that there needs to be a regulatory framework in place for each of the major issues that I just talked about. My broader concern is that if that doesn’t get put in place, then frustration with the industry will continue to grow.”
Facebook closed Q2 with net income of $2.6 billion despite the FTC fine, though the figure was down 49 per cent from $5.1 billion in Q2 2018.
Daily and monthly active users each grew 8 per cent year-on-year to 1.59 billion and 2.41 billion, respectively.
The company estimated over 2.1 billion people, more than a quarter of the global population, now use one of its family of services (Facebook, Instagram, WhatsApp or Messenger) every day.Subscribe to our daily newsletter Back