The internet giant Wednesday reported a slowdown in revenue growth, something it had warned would happen. It’s coming at a time when Facebook faces plenty of tough challenges.
Last week we cautioned of troubles ahead for the social media giant – read here. This is only the beginning.
The main points of Facebook’s latest earnings:
- Fourth-quarter revenue grew 25 percent, to $21.1 billion. That’s the slowest pace in Facebook’s history as a publicly traded company, according to the WSJ.
- Daily users of the core Facebook platform grew to 1.66 billion, beating analyst expectations of 1.65 billion.
- Expenses also rose, reducing Facebook’s operating margin to 42 percent from 46 percent. This seemed to be the decisive factor, causing the selloff.
The company also said it would pay $550 million to settle a class-action lawsuit over its use of facial-recognition technology.
It’s the latest cue of the legal headaches that continue to bedevil Facebook, which also include a slew of new regulations around the world governing security and data.
Shares in Facebook fell 7 percent in after-hours trading Wednesday, with investors worrying that the company has peaked and faces serious downside risk.
Read our full article on Facebook here.