Facebook’s profits topped $ 9 billion in its most recent financial quarter, erasing investor forecasts even as the company faces a wave of negative publicity following a major release of denunciation.
The company revealed in its earnings report on Monday that it saw a 6% year-over-year increase in daily active users, reaching an average of 1.93 billion for September 2021. Its revenue increased by 35% to $ 29.01 billion, thanks to an Internet boom. The advertisement.
Facebook’s financial gains came amid scrutiny, after a consortium of news agencies published articles on Monday based on documents leaked by whistleblower Frances Haugen. Haugen testified to British MPs on Monday calling for external regulation of Facebook.
The latest documents revealed how well Facebook was aware of the aggressive spread of disinformation and hate speech on its platform, that it was reluctant to censor right-wing media outlets for fear of angering it. administration, and how he fought to crack down on humans. traffic operations advertised on Instagram.
In light of the revelations, six major racial justice groups, including Kairos Action, 18 Million Rising, Media Justice, Action Center on Race and the Economy, and US Campaign for Palestine Rights, have called on Mark Zuckerberg to step down as CEO.
“Facebook’s persistent actions to undermine content moderation are the latest evidence that Mark Zuckerberg and Facebook executives will continue to sacrifice the safety of our communities to line their pockets,” the groups said in a statement.
In a call with investors on Monday, Zuckerberg addressed the leaked documents but not their content, saying the issues the company faces “are not primarily about social media” but are “about polarization. [that] started moving to the United States before I was born ”.
“My take on what we are seeing is a coordinated effort to selectively use leaked documents to create a false image of our business,” he added.
Zuckerberg defended Facebook, saying the company invests “more than any other tech company when scaled up” in safety and security. Facebook spent $ 5 billion on safety and security in 2021 – half of what it said it will spend on the Metaverse division and less than 5% of its annual revenue in 2020.
Zuckerberg also said that the company had “launched the supervisory board as a model of self-regulation,” referring to the company’s independent advisory board, and that it had created “a new model for independent academic researchers to access data securely ”.
However, Facebook has been the target of criticism on both fronts, with the supervisory board complaining about the company’s lack of transparency and saying it holds little power with top researchers having been kicked from the platform. form in recent years.
Leaders have also avoided commenting on the appeal documents and have resisted responding publicly in recent days. In forward-looking statements, Zuckerberg has said he’s optimistic about the company’s continued investment in the metaverse – essentially, a digital world built on our own, featuring virtual reality headsets and augmented reality.
In line with these goals, Facebook will now separately report the company’s virtual reality revenue. This means that it will fall into two categories: its “app family” including Facebook, Instagram, Messenger and WhatsApp, and “reality labs” products including AR and VR as well as all related hardware.
“We made good progress this quarter and our community continues to grow,” he said. “I’m excited about our roadmap, especially when it comes to creators, trade, and helping to build the Metaverse. “
Facebook has remained an economic juggernaut in recent years despite growing regulatory hurdles and public criticism, including revelations from Haugen and another anonymous whistleblower describing the company’s relentless inner workings that prioritize profit over profit. to potential security issues.
“The biggest takeaway here is that changes to Apple’s privacy settings haven’t seriously hurt Facebook, at least not yet,” said Haris Anwar, senior analyst at Investing.com. “This shows that Facebook continues to hold pricing power in the digital advertising market, where it remains one of the most important players and trendsetters. “
In the earnings call on Monday, Zuckerberg also referred to Facebook’s persistent problem with teens leaving the platform in droves. Leaked documents further showed how the company struggled to retain younger users.
A chart included in documents released by Haugen recently showed that ‘time spent’ for American teens on Facebook was down 16% year-over-year and the age group was spending 5% of the time. less on the social network.
Zuckerberg said Facebook is “retooling” to make “young adult service” the “Northstar” of the business, even if that means “the rest of our community will grow more slowly than [it] otherwise would ”.
He added that TikTok, which Facebook has attempted to emulate with its Reels feature on Instagram, has been “one of the most effective competitors we’ve ever seen.” These efforts come despite internal Facebook reports revealing just how toxic the platform can be to teens, and young women in particular.