Facebook beat Wall Street revenue projections with user numbers on target despite data privacy scandal

Social media giant continues to grow despite Cambridge Analytica controversy

'Despite facing important challenges, our community and business are off to a strong start in 2018', Mark Zuckerberg said in a statement accompanying the earnings report (REUTERS/Leah Millis)

Facebook beat Wall Street revenue projections and announced that its user numbers were in line with estimates in the wake of a user data privacy scandal.

Up to 87m users saw their data end up in the possession of political consulting firm Cambridge Analytica, which worked for Donald Trump’s presidential campaign. Facebook has since been scrambling to mollify angry politicians and reassure users that it will safeguard their personal information.

Amid that turmoil, observers were keenly watching the company’s user figures to assess the potential damage and see if the scandal would suppress Facebook’s long-term growth.

Its North American user numbers were already flagging at the end of 2017, and since then a number of users have vowed to quit the platform, among them some prominent technology executives, as the #DeleteFacebook movement gained steam.

But the company had substantially more revenue than in the prior year, including a gain of roughly 50 per cent in the all-important advertising revenue category. Its daily and monthly active users grew by double-digit rates, driven by increases in Asia.

Those results again demonstrated the company’s ability to thrive amid controversy. It continued to grow over the last year despite a steady drumbeat of revelations that Russian-linked actors used the platform to try and fracture the electorate and promote Mr Trump ahead of the 2016 presidential election.

Despite negative press and intensified scrutiny from Congress, Facebook beat earnings estimates for the final quarter of 2017.

But its share of daily active users ticked down in the United States and Canada, from 185m to 184m.

The company’s value has plunged since the Cambridge Analytica scandal broke. Facebook shares slid 14 per cent as the company’s executives sought to contain the fallout. Both Chief Operating Officer Sheryl Sandberg and CEO Mark Zuckerberg have said they would be open to additional regulation, raising worries on Wall Street about additional costs

While heralding the company’s “strong start” to 2018, Mr Zuckerberg said in a conference call that the site was still grappling with how to prevent foreign interference and hate speech while shielding data.

“For most of our existence we’ve focused on all the good that connecting people can bring but it’s clear we didn’t do enough to prevent these tools from being used for harm as well”, Mr Zuckerberg said.

“We have a responsibility to keep our community safe and secure and we’re going to invest heavily to do that”, he added.