Facebook (FB) said Thursday that it had 2.7 billion monthly active users at the end of the June quarter, a 12% increase from the prior year. When factoring in all of Facebook’s various apps, including Instagram and WhatsApp, the company topped 3 billion users for the first time.
Facebook (stylized as facebook) is an American online social media and social networking service based in Menlo Park, California and a flagship service of the namesake company Facebook, Inc. It was founded by Mark Zuckerberg, along with fellow Harvard College students and roommates Eduardo Saverin, Andrew McCollum, Dustin Moskovitz and Chris Hughes.
The founders initially limited Facebook membership to Harvard students. Membership was expanded to Columbia, Stanford, and Yale before being expanded to the rest of the Ivy League, MIT, and higher education institutions in the Boston area, then various other universities, and lastly high school students. Since 2006, anyone who claims to be at least 13 years old has been allowed to become a registered user of Facebook, though this may vary depending on local laws. The name comes from the face book directories often given to American university students.
Facebook can be accessed from devices with Internet connectivity, such as personal computers, tablets and smartphones. After registering, users can create a profile revealing information about themselves. They can post text, photos and multimedia which is shared with any other users that have agreed to be their “friend”, or, with a different privacy setting, with any reader. Users can also use various embedded apps, join common-interest groups, buy and sell items or services on Marketplace, and receive notifications of their Facebook friends’ activities and activities of Facebook pages they follow. Facebook claimed that it had more than 2.3 billion monthly active users as of December 2018, and it was the most downloaded mobile app of the 2010s globally.Facebook has been subject to extensive media coverage and many controversies, often involving user privacy (as with the Cambridge Analytica data scandal), political manipulation (as with the 2016 U.S. elections), psychological effects such as addiction and low self-esteem, and content such as fake news, conspiracy theories, copyright infringement, and hate speech. Commentators have accused Facebook of willingly facilitating the spread of such content.
Facebook stock jumps 7% as pandemic helps make its audience …
A pandemic (from Greek πᾶν, pan, “all” and δῆμος, demos, “people”) is an epidemic of an infectious disease that has spread across a large region, for instance multiple continents or worldwide, affecting a substantial number of people. A widespread endemic disease with a stable number of infected people is not a pandemic. Widespread endemic diseases with a stable number of infected people such as recurrences of seasonal influenza are generally excluded as they occur simultaneously in large regions of the globe rather than being spread worldwide.
Throughout human history, there have been a number of pandemics of diseases such as smallpox and tuberculosis. The most fatal pandemic in recorded history was the Black Death (also known as The Plague), which killed an estimated 75–200 million people in the 14th century. The term was not used yet but was for later pandemics including the 1918 influenza pandemic (Spanish flu). Current pandemics include COVID-19 and HIV/AIDS.
The company said its daily and monthly active users numbers “reflect increased engagement as people around the world sheltered in place and used our products to connect with the people and organizations they care about.” However, the company said as stay at home orders begin to ease, it expects engagement to be flat or to slightly decline in the next three months, compared to the past quarter.
Facebook’s stock jumped more than 7% in after hours trading Thursday following the earnings report.
Facebook stock jumps 7% as pandemic helps make its audience …
The earnings release comes at a sensitive moment for the company. On Wednesday, Facebook CEO Mark Zuckerberg appeared before Congress along with CEOs from Apple (AAPL), Amazon (AMZN) and Google parent company Alphabet (GOOGL), where they were grilled about their competitive tactics.
On a call with analysts, Zuckerberg and other Facebook executives repeatedly played up how much they believe the platform helps small businesses and that significant changes could hit the broader economy.
Four tech titans go before Congress
“I’m troubled by the calls to go after internet advertising, especially during a time of such economic turmoil like we face today with Covid,” Zuckerberg said. “It’s true that making it more difficult to target ads would affect the revenue of companies like Facebook. But the much bigger cost of such a move would be to reduce the effectiveness of the ads and opportunities for small businesses to grow. … it would probably be felt at a macroeconomic level.”
“Is that really what policymakers want in the middle of a pandemic and recession?” Zuckerberg added.
Zuckerberg reused some of his prepared remarks from yesterday’s hearing on the call, touting the tech industry as an “American success story,” and saying that “the products we build have changed the world for the better and improved people’s lives.”
“Since Covid emerged, people have used our services to stay in touch with friends and family who they can’t be with in person, and to keep their businesses running online even when physical stores are closed,” Zuckerberg said on the call. “In many ways amidst this very difficult period for people around the world, our services are more important now than ever before.”
Facebook is also confronting a major advertising boycott that includes numerous household brands, such as Hershey’s, Starbucks and Patagonia. A civil rights coalition that includes the Anti-Defamation League and the NAACP launched the #StopHateforProfit campaign, calling on major companies to halt advertising on Facebook for the month of July due to the platform’s “repeated failure to meaningfully address the vast proliferation of hate on its platforms.”
But whatever financial impact there may be from the boycott would not be seen during the second quarter, which ended in June.
Facebook CFO Sheryl Sandberg pointed to the company’s meeting with the organizers of the boycott to listen to their concerns, as well as publishing an independent, two year civil rights audit. “It’s clear we have a lot more to do and we’re working every day to meet this challenge, not because of pressure from advertisers, but because it is the right thing to do,” she said.
While some brands have committed to pause spending through the end of this month, others such as household goods giant Unilever are halting advertising through the end of the year across social media, not just Facebook. However, much of Facebook’s ad revenue comes from small and medium-sized businesses, which could potentially protect it from a significant revenue shortfall.