Facebook beats expectations but worries market with time well spent crusade
Facebook smashed expectations late last night with fourth-quarter revenues of $13bn (£9.1bn).
Analysts had pencilled in $12.6bn of sales in the three months to December. Earnings per share were $2.21 compared with consensus projections of around $1.95.
But shares fell almost five per cent in after-hours trading, after CEO Mark Zuckerberg said the tech titan had made changes to the news feed, its flagship page, which reduced the amount of time users spent on the platform.
During the last quarter users’ time spent on Facebook had fallen by around 50m hours every day.
Around 2.13bn people used its service monthly as of 31 December, up 14 per cent from a year earlier.
“Already last quarter, we made changes to show fewer viral videos to make sure people’s time is well spent,” Zuckerberg said.
Read more: Forget pivot to video, now Facebook’s all about local news says Zuckerberg
Both quarterly and full-year total revenue grew by 47 per cent, with the full year tally hitting $40.65bn.
Mobile ad revenue accounted for 89 per cent of the total ad sales, up from 84 per cent a year earlier.
“In 2018, we’re focused on making sure Facebook isn’t just fun to use, but also good for people’s well-being and for society. We’re doing this by encouraging meaningful connections between people rather than passive consumption of content.”
The tech titan also plans to highlight “trustworthy” news in the feed, following allegations that false reports spread rapidly on the site.
Facebook said US President Donald Trump’s tax reforms would lower earnings per share by 77 cents for the fourth quarter and full-year.
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