Despite ongoing public relations crises, Facebook kept growing in Q3 2019. Facebook reached 2.45 billion monthly users, up 1.65 percent from 2.41 billion in Q2 2019 when it grew 1.6 percent, and it now has 1.62 billion daily active users, up 2 percent from 1.587 billion last quarter when it grew 1.6 percent. Facebook scored $17.652 billion of revenue, up 29 percent year-over-year.
Facebook’s earnings beat expectations compared to Refinitiv’s consensus estimates of $17.37 billion in revenue and $1.91 earnings per share. Facebook earned $6 billion in profit after only racking up $2.6 billion last quarter due to its SEC settlement.
Facebook shares shot up 3.45% in after hours trading to $194.75 after earnings were announced, following a day where it closed down 0.56% at $188.25.
It was another rough quarter for Facebook’s public perception as it dealt with outages and struggled to get buy-in from regulators for its Libra cryptocurrency project. Former co-founder Chris Hughes (who I’ll be leading a talk with at SXSW) campaigned for the social network to be broken up — a position echoed by Elisabeth Warren and other presidential candidates.
The company did spin up some new revenue sources, including taking a 30% cut of fan patronage subscriptions to content creators. It’s also trying to sell video subscriptions for publishers, and it upped the price of its Workplace collaboration suite. But gains were likely offset as the company continued to rapidly hire to address abusive content on its platform. There are still problems with how it treats content moderators, and Facebook has had to repeatedly remove coordinated misinformation campaigns from abroad. Appearing concerned about its waning brand, Facebook moved to add “from Facebook” to the names of Instagram and WhatsApp.
While it escaped with just a $5 billion fine as part of its FTC settlement that some consider a slap on the wrist, especially since it won’t have to significantly alter its business model. But the company will have to continue to invest and divert product resources to meet its new privacy, security, and transparency requirements. These could slow its response to a growing threat: Chinese tech giant ByteDance’s TikTok.