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More users, more revenue - Facebook defies billions

The second quarter of 2019 has brought Facebook a huge growth. A $ 5.1 billion fine was taken and sales grew to $ 16.9 billion.

More users, more revenue - Facebook defies billions

Tuesday August 27, 2019,

4 min Read

The social network is blessed with tremendous growth despite all the prophecies of doubters, all criticisms, and all the procedures against the company. User numbers are rising, daily and monthly active users are steadily increasing. 

Sales rose 28 percent year on year. Only the profit went back, which, however, is also related to other provisions. The $ 5 billion that Facebook has to pay as a penalty for violating privacy rules seems to be trivial.

Number of users rises to over 2.4 billion

Facebook's second quarter report 2019 abounds with positive numbers. The number of users is growing, even though the platform in the US or Europe had often predicted a gradual decline. The monthly active users are now at 2.41 billion, an eight percent growth over the previous year. Daily users were also up from 1.56 to 1.59 billion. 

According to Facebook chief financial officer David Wehner, this growth comes mainly from countries such as India, Indonesia or the Philippines. This seems logical if one assumes that Facebook is sometimes synonymous with Internet usage in such regions. However, in particular Facebook in the US or Europe is much less used by many users who are still registered. 

The extremely popular family of Facebook affiliates from Messenger, WhatsApp and Instagram currently has 2.1 billion users a day. At least once a month, the services are even used by 2.7 billion people.

Turnover increases, profits halve

Financially, Facebook also exceeded expectations in the past quarter. With now 16.9 billion US dollars in sales, compared to the previous year (13.2 billion), an increase of 28 percent. According to ARD Börse , the stock of the company rose by just 3.2 percent in after-hours trading. 

Only the profit - with 2.6 billion still more than considerable - declined. It stood at 5.1 billion in the previous year, so shrank by a good half. However, Facebook has just under $ 2 billion to prepare for any higher tax payments, which are being negotiated in a lawsuit. Mark Zuckerberg commented on the positive developments:

We had a strong quarter and our business and community continue to grow. We are investing in building our privacy policy.

In fact, Facebook has more often to answer in privacy issues. The company agreed to settle with the FTC for $ 5.1 billion. The highest penalty payment in US commercial supervision history. This immense payment seems to put away Facebook financially but well. The FTC also imposed strict privacy policies on Facebook.

The magnitude of the $ 5 billion penalty and sweeping conduct are unprecedented in the history of the FTC. The relief is designed to reduce the likelihood of violations. The Commission takes consumer privacy seriously, and wants to enforce FTC orders to the fullest extent of the law.

A panel to oversee data protection decisions should be established. Zuckerberg also addresses this development in his personal statement.

We'll have to certify that we're meeting all our privacy commitments. And now we have an audit committee on our board, so we have a new board of directors for the board of directors FTC. We are one of our most experienced leaders in product safety. We'll be more rigorous in monitoring developers who access data through our platform. Together, we expect these changes will set a new standard for our industry.

There is now a shift in Facebook's corporate culture, says Zuckerberg. A more prudent treatment of privacy issues is needed. After all, the FTC has announced that a competition test will be initiated on Facebook. This was confirmed by the social networks in the quarterly report. In addition, the Department of Justice will initiate an antitrust investigation of leading marketing platforms; Facebook, although not explicitly named, also counts.

But despite all these dark clouds and ever greater punishments, the biggest social medium is flourishing. And any subsequent penalties may not be significant, given the popularity of the entire Facebook family and the immense revenue. Therefore, in the future, structural requirements will be the more important lever in the fight for more data security in the social media cosmos.