Facebook profit soars, unaffected by Russia ad issue
Facebook profit soars, unaffected by Russia ad issue
The company’s shares, which hit a record earlier in the day, initially rose in after-hours trading, but later fell into negative territory. They have gained almost 60 percent this year.
Chief Executive Mark Zuckerberg condemned Russia’s attempts to influence last year’s election through Facebook posts designed to sow division, and repeated his pledge to ramp up spending significantly to increase the social network’s security, something he said on Wednesday would affect profits.
“What they did is wrong, and we are not going to stand for it,” Zuckerberg said of the Russians, on a conference call with analysts.
Facebook is at the center of a political storm in the US for the ways it handles paid political ads and allows the spread of false news stories. US lawmakers have threatened tougher regulation and fired questions at Facebook General Counsel Colin Stretch in hearings this week.
Facebook, in a series of disclosures over two months, has said that people in Russia bought at least 3,000 US political ads and published another 80,000 Facebook posts that were seen by as many as 126 million Americans over two years. Russia denies any meddling.
Facebook’s total advertising revenue rose 49 percent in the third quarter to $10.14 billion, about 88 percent of which came from mobile ads.
Analysts on average had expected total ad revenue of $9.71 billion, according to data and analytics firm FactSet.
Facebook in the third quarter gave advertisers for the first time the ability to run ads in standalone videos, outside the Facebook News Feed, and the company is seeing good early results, Chief Operating Officer Sheryl Sandberg told analysts on a conference call.
“Video is exploding, and mobile video advertising is a big opportunity,” Sandberg said.
More than 70 percent of ad breaks up to 15 seconds long were viewed to completion, most with the sound on, she said.
The 49 percent increase in total ad sales in the latest quarter compares with a 47 percent rise in the prior quarter and a 51 percent jump in the first quarter.
Facebook has been warning for more than a year about reaching a limit in “ad load,” or the number of ads the company can feature in users’ pages before crowding their News Feed.
Advertisers seem unfazed, though, spending heavily as the social network continues to attract users.
The nearly 50 percent jump in ad revenue “is phenomenal, especially when for the past few quarters they’ve been trying to bring that expectation way, way down. Yet it keeps going up,” Tigress Financial Partners analyst Ivan Feinseth said.
Of the Russia scandal enveloping Facebook publicly, Feinseth said: “In the bigger picture, I don’t think it’s a really big factor.”
The company’s performance was strong in comparison with smaller social media firms Snap Inc. and Twitter Inc. , Wedbush analyst Michael Pachter said.
“Facebook grew revenues by $3.3 billion year-over-year for the quarter. This is more than Twitter and Snapchat generate combined for the full year,” he said.
Facebook said about 2.07 billion people were using its service monthly as of Sept. 30, up 16 percent from a year earlier.
Analysts on average had expected 2.06 billion monthly active users, according to FactSet.
Net income rose to $4.71 billion, or $1.59 per share, from $2.63 billion, or 90 cents per share.
Analysts on an average were expecting the company to earn $1.28, according to Thomson Reuters.
Total revenue increased 47.3 percent to $10.33 billion beating analysts estimate of $9.84 billion, according to Thomson Reuters.
Various US investigations into how Russia may have tried to sway American voters in the months before and after last year’s elections are hanging over Facebook and its competitors.
There is also proposed US legislation that would extend rules governing political ads on television, radio and satellite to also cover digital advertising.
“We expect more scrutiny about Facebook’s ad system ahead,” analyst Debra Aho Williamson of research firm eMarketer said in a note. “We’re also monitoring for any signs that this investigation will have a material impact on ad revenue.”
Live from Idlib, an American broadcasts from Syria’s last rebel zone
- Around 3 million people live in Idlib and surrounding rebel territory, including foreigners who have joined the war against the Assad regime
BEIRUT: Pointing to a green screen as if presenting a weather forecast, Bilal Abdul Kareem analyzes the Turkish-Russian deal over Syria’s Idlib, broadcasting in his native English from inside the war-torn country’s last opposition stronghold.
The 47-year-old American is a long way from where he grew up near the Bronx, watching reruns of “Rocky” and eating at Italian restaurants.
Dressed in a charcoal suit jacket, the broad-shouldered and bearded Abdul Kareem stares into the camera and insists: “In this deal, this specific deal, nobody can say the rebels were not winners.”
For the past six years, he has reported from shrinking opposition territory in Syria’s north, filming the aftermath of airstrikes, interviewing hard-line fighters, even meeting Al-Qaeda members.
His contacts, including in Hayat Tahrir Al-Sham (HTS), have granted him extensive access at a time when the risk of abduction makes much of Syria too dangerous for journalists from mainstream news outlets.
But it has also prompted allegations that Abdul Kareem is an extremist “propagandist” and would not have survived in the area had he been an impartial journalist — particularly given HTS’ history of harsh crackdowns against perceived foes.
Speaking to AFP from Idlib over Skype, WhatsApp, and Facebook, Abdul Kareem denied the claims and directed accusations of his own: He is suing the US government for allegedly trying to kill him in Syria.
As the case drags through US courts, the self-described “bald-headed black guy in the middle of Syria” has remained in Idlib despite fears of a looming regime offensive, continuing to file dispatches for his media upstart, On the Ground News.
Born Darrell Lamont Phelps, Abdul Kareem embraced Islam before moving to the Middle East in 2002. He married and had children in Egypt, but declined to disclose their location for security reasons.
He arrived in Syria in 2012 from Libya, curious about the fighters battling President Bashar Assad’s forces in a conflict which at that point was just a year old.
Working first with major broadcasters including CNN, he founded OGN in 2015 as editors started to express “doubts” about his political stances, he said.
The channel now publishes on YouTube, Twitter, and a Facebook page with more than 86,000 followers.
“I have a good working relationship with every group, which doesn’t necessarily mean I agree with everything they do or they agree with everything I do,” he said.
A normal day begins with dawn prayers at 4:30 a.m., followed by a routine search of his car for bombs. The rest is up to the news cycle.
He could find himself on a motorcycle zipping toward a frontline, lapel mic in hand but without protective gear, or sipping tea with hardcore fighters most Americans would consider unsavory.
“I remember I had these very, very in-depth conversations with different Al-Qaeda members about America, Americans and the democratic system,” Abdul Kareem said.
He offered unsuccessfully to facilitate a dialogue between Western powers and Idlib’s militants, whom he insisted don’t have “blood dripping from their fangs and want to eat American children.”
The US has designated Al-Qaeda and HTS “terrorist organizations.” Around 3 million people live in Idlib and surrounding rebel territory, including foreigners who have joined the war against the Assad regime. “There are quite a few Americans here. All fighters,” Abdul Kareem said. Asked about his future, he recalled escaping second city Aleppo as it fell to the regime in 2016. If the same fate awaits Idlib, he said, “I would be one of the last people to leave.” Abdul Kareem’s 16-year absence from the US has made him miss simple things: speaking English, sugary cereals. But he fears the 2016 election of President Donald Trump has changed the country too much.
“It sounds like America is not the same America that I grew up in,” he said. His remaining links are with his sister, and a lawsuit he filed last year against Trump and a coterie of US officials, accusing the government of attempting to kill him five times. Once was on a reporting trip. “My car was hit with a drone strike. The car flipped up into the air and landed on its side facing the opposite direction,” he said. Abdul Kareem is demanding the government stop targeting him, remove him from any so-called “kill list” and disclose the names of other citizens who may be on it. In the meantime, OGN’s cameras keep rolling.
“I’m not in America because being here in Syria doing the work that I’m doing and covering the things I’m covering, in my estimation, is the right thing to do,” Abdul Kareem said.
“People are dying by the droves, and if I can do something to help people see what the real realities are, then what business do I have going back to America right now?“