Facebook revenue, user growth falls short of expectations

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Investors are buying into the vision for now.

The social network is now working to bolster its services.

I expect 2019 to be another year of significant investment... That having been said users aren't willing to swap their timelines for stories just yet and that present a problem. This figure was higher by 9% than in September of a year ago. The largest portion of that revenue - 92 percent - came from mobile advertising up from 88 percent in the third quarter of 2017.

Facebook will announce its Q3 earnings results after markets close on Tuesday.

The company had previously warned of an easing in key growth rates for the rest of the year because of several pressures including the rising cost of security protection. Regardless, Zuckerberg said he believes the opportunity with stories "will be bigger" than that of the News Feed, the scrolling wall of posts from friends that has dominated most Facebook users' experience for years. Facebook's spending has ballooned as it tries to fortify itself against fraudsters and hackers, and as it invests in more engaging content such as video.

CEO Mark Zuckerberg said people increasingly want to share ephemerally through Stories or privately via direct messaging. So this means that even though we've made video more community-oriented and minimized displacement of social interactions, as video grows, it will still displace some other services where we'd probably make more money. "When you start to see users turn away from the platform, that's when investors get concerned".

Facebook's video platform Watch is growing, on the back of a general rise in video content, but Zuckerberg noted it is well behind YouTube.

Facebook stressed the breadth of its services, which include Facebook, WhatsApp, Instagram and Messenger. Suitable ads are hard to make, he added.

"I think it is pretty smart for them to do politically ー partially because Apple and their CEO Tim Cook has been so unusually candid about his opinion on Facebook recently and data privacy ー to kind of draw them into the mix", deputy technology editor at Quartz, Mike Murphy, told Cheddar on Wednesday.

Tuesday's results bought Zuckerberg some time to pursue the new initiatives.

Investors were particularly scared by Facebook's forecasts, with executives telling Wall Street that Facebook's operating margin would sink from the mid-forties to the mid-30 per cent range. Daily active users were up 9pc to 1.49bn while monthly active users were up 10pc to 2.27bn. In the European Union over the third quarter, Facebook lost 1 million daily users, partly because of tough new data privacy regulations that were put into place, said Dave Wehner, the company's chief financial officer. Facebook also missed on active user numbers.

"We will see all the good and bad humanity can do".

As Facebook user growth has tapered off, its ad sales had continued to surge as it found ways to better target ads to draw clicks and views. Profit increased by nine per cent to almost 1.34 billion dollars (1.18 billion euros).

Controversies that have battered Facebook since the 2016 presidential election in the United States have even caused some to question whether co-founder Mark Zuckerberg should continue as chief executive.

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