Facebook Grows Profit, Despite Multiple Scandals

Facebook has survived a year of scandals that have had very little impact on the financial bottom line of the social networking giant.

Indeed, Facebook grew both profits and revenues for both its fourth quarter and year end 2018 results, despite concerns that growth was slowing after the firm was plagued with mutiple problems in 2018.

Advertising remains Facebook’s main cash cow, and Chief Operating Officer (COO) Sheryl Sandberg had warned in April 2018 after the Cambridge Analytica data harvesting scandal that a few” advertisers had paused their spending with Facebook as a result of the controversy.

Impressive growth

But the reality is that any such blip was very temporary indeed and has had no lasting impact on the firm.

For the fourth quarter ending 31 December, Facebook posted a net profit of $6.9bn, up 61 percent from the $4.3bn profit it recorded in the same quarter a year earlier. Revenues meanwhile rose 30 percent to $16.9bn from $12.9bn previously.

This stunning growth translated across to the full year results as well. Profit for 2018 came in at $22.1bn, up 39 percent from $15.9bn in 2017.

Revenue for 2018 was up 38 percent at $55.8bn from $40.6bn in 2017.

Advertising revenues for 2018 were a staggering $55bn. The bulk of this (93 percent) is from mobile advertising revenues.

“Our community and business continue to grow,” said CEO Mark Zuckerberg. “We’ve fundamentally changed how we run our company to focus on the biggest social issues, and we’re investing more to build new and inspiring ways for people to connect.”

Facebook has grown the number of staff 42 percent in the past year and total headcount is now sitting at 35,587 people.

Facebook also revealed that its daily active users (DAUs) for December was 1.52 billion people on average, an increase of 9 percent year-over-year.

The firm also revealed that around 2.7 billion people now use Facebook, Instagram, WhatsApp, or Messenger each month.

Year of scandals

For Zuckerberg, 2018 would have seemed like a year of scandals. The Cambridge Analytica scandal was huge and it forced Zuckerberg to apologise on multiple occansions and face investigations from bodies around the world.

And then in the Autumn, Facebook admitted that hackers had gained access to nearly 50 million accounts by exploiting flaws in the social network’s code.

And then just before Christmas Facebook was on the defensive again when it emerged that leading tech firms and consumer brands had struck deals with Zuckerberg’s company to harvest the personal data of millions of its users.

Going forward, Facebook is also likely to experience pushback from its “long term project” that will see the planned integration of messaging platforms for WhatsApp, Instagram and Messenger.

Quiz: Think you know all about Facebook?