Facebook Shrugs Off Regulatory Worries, Handily Beats Q2 Estimates


Facebook did not break stride despite agreeing Wednesday morning to pay a record $5 billion fine to the U.S. government, posting second-quarter results after the close of trading that exceeded Wall Street expectations.

Earning per share came in at $1.99 a share, better than analysts’ consensus forecast of $1.88, while total revenue of $16.6 billion beat estimates and gained 28% over the year-earlier figure.

The company said its daily and monthly active user metrics each increased 8% — DAUs climbed to 1.59 billion, with MAUs at 2.41 billion as of June.

Stock in Facebook closed at $204.66, up 1%. It has soared 51% in 2019 to date. Investors sent it another 1% higher in after-hours trading.

The agreement finalized Wednesday with the Federal Trade Commission carries one of the biggest fines in U.S. corporate history. For a company with a market capitalization of $584 billion, however, it’s almost a rounding error and the earnings release noted a charge in the period of $2 billion, which is less than the $3 billion it had previously indicated it had set aside for the purposes of the settlement.

More significant, when it comes to the FTC deal, is the message CEO Mark Zuckerberg decides to convey about the company’s new obligations to tighten controls on the use of data. Having already admitted to abusing the public’s trust and repeatedly pledging to “do better,” the company founder and majority shareholder will now be expected to live up to those vows.

The U.S. Department of Justice has also opened an antitrust investigation into the activities of Facebook and its tech peers.

“We had a strong quarter and our business and community continue to grow,” Zuckerberg said. “We are investing in building stronger privacy protections for everyone and on delivering new experiences for the
people who use our services.”

This article was printed from https://deadline.com/2019/07/facebook-shrugs-off-regulatory-worries-handily-beats-q2-estimates-1202652901/