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Facebook withstands scandal to beat first-quarter forecasts
(WebFG News) - Facebook's first-quarter earnings beat expectations and the social network added millions of users as the company appeared to withstand a scandal involving the misuse of personal data, as tech chief Mike Schroepfer told UK parliament "radical transparency" measures will be introduced for political advertising.
Net income for the three months to the end of March rose 63% to $4.99bn (£3.6bn), or $1.69 a share, from $3.06bn, or $1.04 a share, a year earlier. Analysts average forecast was for profit of $1.35 a share, according to Reuters.
The number of monthly active users of Facebook rose 13% in the first quarter to 2.2bn.
The figures suggest consumers are largely unperturbed by the revelation in mid-March that users' data was shared with Cambridge Analytica, a UK-based election consultant that helped Donald Trump with his 2016 campaign.
The scandal, which affected 87m users sparked a campaign urging Facebook members to leave the site and calls for tighter regulation. Facebook makes most of its revenue from advertising which it targets at individual users based on their online activity.
Chief executive and founder Mark Zuckerberg said: "Despite facing important challenges, our community and business are off to a strong start in 2018."
Zuckerberg told Congress on 10 April he would strengthen privacy measures and take action against fake news and hate speech. Alongside its earnings Facebook said it would increase spending to scrap bogus accounts, erase hate speech and take down violent videos.
Zuckerberg said: "We are taking a broader view of our responsibility and investing to make sure our services are used for good. But we also need to keep building new tools to help people connect, strengthen our communities, and bring the world closer together."
PARLIAMENTARY EVIDENCE
In written evidence to UK parliament, Facebook revealed it had found "certain billing and administrative connections" between Cambridge Analytica and AIQ - the data firm that helped Vote Leave in the run up to the Brexit referendum. It added that AggregateIQ had spent $2m on Brexit-related ads in the UK.
But the evidence also claimed the 50m profiles scraped from Cambridge data scientist Dr Alexander Kogan and given to Cambridge Analytica were not used by AIQ or Vote Leave.
At Westminster on Thursday, chief technical officer Schroepfer, was grilled by MPs in the Department for Digital, Culture, Media and Sport committee into fake news, telling them Facebook will introduce "radical transparency" in order to reassure the public over political advertising on the social network.
Facebook will require political adverts to be labelled and authorised, with funding information published so users can see which group has paid for them.
"Obviously political advertising is a really important issue," Schroepfer told the DCMS committee. "We think one of the best tools to work on this problem is to give everyone radical transparency about what is happening here.
"We're going further with political advertising because we understand how important this is."