Facebook lost $120 bn in market value over slow growth
San Francisco, July 26: Facing global backlash over the massive Cambridge Analytica data scandal, Facebook stock nosedived 20 per cent -- wiping over $120 billion off the company's market value -- after its revenue and user growth in the second quarter of 2018 fell short of investor expectations.
The social media giant late on Wednesday reported 2.23 billion monthly active users (MAUs) -- an increase of 11 per cent (year-over-year) which was its slowest growth in more than two years.
Facebook reported revenue of $13.2 billion -- a gain of 42 per cent but missing analyst expectation of $13.3 billion. It ended the quarter with $42.3 billion in cash and equivalents.
The social media platform earned $5.1 billion, or $1.74 per share, for the second quarter.
"Our community and business continue to grow quickly. We are committed to investing to keep people safe and secure, and to keep building meaningful new ways to help people connect," said CEO Mark Zuckerberg in a statement.
The daily active users (DAUs) were 1.47 billion as of June 30, also an increase of 11 per cent year-over-year.
Analysts attributed the slow user growth to the European privacy law that went into effect on May 25.
Mobile advertising revenue represented approximately 91 per cent of advertising revenue for the second quarter of 2018 -- up from approximately 87 per cent of advertising revenue in the second quarter of 2017.
Facebook currently employs 30,275 people -- an increase of 47 per cent year-over-year.
"We expect revenue growth rates to continue to decelerate in the second half," said David Wehner, Chief Financial Officer.
In April, Facebook had warned investors that more users' data scandals in the future may adversely affect the social networking giant's reputation and brand image.
Appearing before the US Congress, Zuckerberg told the lawmakers that his own personal data was part of 87 million users' that was "improperly shared" with the British political consultancy firm Cambridge Analytica.
After the Cambridge Analytica data scandal, Facebook suspended Boston-based data analytics company Crimson Hexagon over concerns that it harvested users' data.
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Inappropriate for MLAs seeking free IPL tickets, says D.K. Suresh
Bengaluru: Bengaluru Milk Union Ltd President D.K. Suresh on Monday said it is inappropriate for MLAs to seek free IPL tickets, adding that those interested in watching matches should pay for them personally.
Speaking to reporters near his residence in Sadashivanagar, he said, “IPL is a commercial tournament and does not represent the country. It is not right for public representatives to focus too much on such matters.”
Referring to the recent controversy during the RCB celebrations, he said, “let us find out who benefited the most from the statements made during the incident.” He also pointed out that BJP MLAs had received IPL tickets as well.
Responding to discussions about relocating the Chinnaswamy Stadium, Suresh said the government has already approved the construction of a new stadium at a location he had proposed.
“I had suggested building a stadium in Surya City and submitted a proposal for it. Bengaluru needs four stadiums in four directions to cater to its growing population and encourage youth participation in sports,” he said.
He noted that apart from Kanteerava Stadium, KSCA, and the Football Stadium, there are limited facilities in the city.
“When I was a Lok Sabha member, I had proposed allocating 100 acres in my constituency at Surya City. The land was later earmarked and the plan approved,” he added.
Suresh said he has discussed the project with Minister Zameer Ahmed Khan, Rajiv Gandhi Housing Corporation Chairman Shivalingegowda, and Anekal MLA Shivanna.
“The Cabinet has now approved the project, and a stadium will be developed on around 50–60 acres,” he said.
He further added that he has requested the Deputy Chief Minister to build another stadium at Shivarama Karanth Layout through the BDA, where 40 acres have been allocated. Plans are also being discussed to develop a well-equipped stadium in Bidadi.
Commending state government's recent bilingual policy move, Suresh said forcing children to learn three languages could affect their comprehension.
“It is a good decision to make two languages compulsory. Learning a third language should be left to the choice of students and parents,” he said.
Responding to criticism from BJP leaders, he said their tendency is to oppose every decision of the government.
“To please their central leadership, they take a pro-Hindi stance. Instead, they should advocate for the adoption of Kannada in all states,” he said.
When asked about the earlier three-language policy under Congress, he said, “the situation is different now. Today, the focus should be on quality learning. Kannada should remain the primary language, while students and parents can choose an additional language.”
