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As User Data Scandal Persists, Facebook Reports Record Earnings

Apr 26, 2018
Originally published on April 26, 2018 7:40 am
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Despite criticism for sharing disinformation and sharing people's data, Facebook reported another quarter of record earnings. NPR's Aarti Shahani reports.

AARTI SHAHANI, BYLINE: Mark Zuckerberg started off on point - on a talking point, that is.

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MARK ZUCKERBERG: For most of our existence, we've focused on all the good that connecting people can bring.

SHAHANI: That's him on the earnings call.

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ZUCKERBERG: But it's clear now we didn't do enough to prevent these tools from being used for harm as well.

SHAHANI: It's the script he's been saying over and over again with news outlets before Congress - Facebook will be more responsible. They're sorry. But - here is a firm but - nothing that has transpired - Russian interference, 87 million user profiles hijacked - none of that shakes his faith in the business model.

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ZUCKERBERG: We think that ads is a great business model that is aligned with our mission.

SHAHANI: And it's a lot more lucrative than charging everyone a subscription, say, a dollar a pop. Facebook reported revenue of nearly $12 billion dollars in the first quarter of 2018, up nearly 50 percent from the prior year. That's a big jump. The very first question from Wall Street was, will Facebook look for other ways to make real money besides mining user data and targeting ads? Zuckerberg's answer is no.

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ZUCKERBERG: We think that that is both the most efficient way to run the business. It offers every business in the world the lowest prices that we can potentially offer. And it provides a great free service to people around the world.

SHAHANI: Daily active users climbed globally to 1.45 billion in March, up 13 percent from the prior year. That includes an uptick in the U.S. and Canada. At the end of 2017, Facebook saw their first-ever decline here. So these latest numbers signal recovery on the company's home turf. Zuckerberg expressed one big regret on the call - no, not about privacy - about domination. He said back when smartphones were really taking off, Facebook was too young to compete with Apple and Google. Now that virtual reality, people living with 3-D headsets is on the horizon, he wants to make sure his company takes the lead.

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ZUCKERBERG: And I think the reality is, Facebook needs to be investing before it is a big thing in order to build some of the muscles to be competitive if we're committed to doing that because I think that this is important for our mission.

SHAHANI: Analysts did not appear to be concerned about U.S. regulators, the Federal Trade Commission, harming Facebook's bottom line. And if the #DeleteFacebook movement has gained any traction, those numbers would likely show up in the next quarterly earnings.

Aarti Shahani, NPR News, San Francisco.

(SOUNDBITE OF OUT OF GRAVITY'S "SPACE ELEVATOR") Transcript provided by NPR, Copyright NPR.