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Facebook stock was up in after-hours trading on Wednesday after the company reported its fourth-quarter earnings. The company warned the looming changes in Apple’s iOS 14 and a reversal in pandemic trends could hurt its advertising business.
Here are the numbers:
Earnings: $3.88 per share vs $3.22 per share forecast by Refinitiv
Revenue: $28.07 billion vs $26.44 billion forecast by Refinitiv
Daily active users (DAUs): 1.84 billion vs 1.83 billion forecast by FactSet
Monthly active users (MAUs): 2.8 billion vs 2.76 billion forecast by FactSet
Average revenue per user (ARPU): $10.14 vs $9.49 forecast by FactSet
Facebook CEO Mark Zuckerberg said that the company is now considering steps to reduce the amount of political content that users see in their News Feed. This announcement comes in the wake of the insurrection at the U.S. Capitol on Jan. 6.
“One of the top pieces of feedback that we’re hearing from our community right now is that people don’t want politics and fighting to take over their experience on our services,” Zuckerberg said.
Additionally, Zuckerberg announced that Facebook plans to permanently stop recommending civic and political groups to users around the world. This comes after the company temporarily decided to stop recommending these groups to U.S. users in October in the lead up to the 2020 U.S. elections.
“This is a continuation of work we’ve been doing for a while to turn down the temperature and discourage divisive conversations,” Zuckerberg said.
The company said that it benefited in 2020 by a shift toward online commerce and products during the pandemic. Facebook warned that these trends may moderate or reverse and “could serve as a headwind to our advertising revenue growth.”
The company also warned that Apple’s privacy changes in iOS 14 that could impact Facebook’s ability to target ads could start to impact its business late in the first quarter.
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