Dominic Rushe in New York
Facebook’s profits soared 61%, spurred by growth in mobile users at the end of last year, the company announced on Wednesday, as co-founder Mark Zuckerberg said 2017 had been one of the company’s more difficult years as a public company.
Zuckerberg has vowed to fix the issues at the social network, including concerns it was used as a platform for Russian meddling in the US elections. Facebook was also criticised over censorship and the addictive qualities of social media.
Zuckerberg said: “Twenty-seventeen was a strong year for Facebook, but it was also a hard one. In 2018, we’re focused on making sure Facebook isn’t just fun to use, but also good for people’s wellbeing and for society.”
He said the company was doing this by “encouraging meaningful connections between people rather than passive consumption of content”.
Facebook faces intense pressure to address issues on its platform. On Wednesday top Democratic lawmakers demanded more details from the company and Twitter about the extent to which Russian bots were being used to push stories on their platforms. In particular the lawmakers want to know the extent to which foreign actors have been involved in pressing for the release of a controversial memo alleging abuse of power by the FBI.
The company’s share price fell close to 5% in after-hours trading even as Facebook announced figures for the last three months of 2017 that were broadly in line with analysts’ expectations. The fall appears to have been caused by fears that the changes Zuckerberg intends to make will slow growth and reduce people’s engagement with the service.
On a call with analysts Zuckerberg said: “The world feels anxious and divided and that has played out in Facebook.”
He said the company was moving away from “passive” consumption of news and video and wanted to build more personal connections between its users. The changes might lead to a drop in the time people spent on Facebook, he said. But content such as viral videos was crowding out personal connections and “helping people connect is more important than maximising the time spent on Facebook”.
Facebook’s revenues topped $12.7bn for the quarter and the company made a profit of $4.26bn – once again demonstrating the company’s dominance in social media advertising. The social platform will capture 18.4% of the $266bn global digital ad market this year, according to eMarketer, making it the number two ad publisher behind Google, which has a 31.3% share.
Facebook’s operating profits would have been $7.35bn except for a $3.19bn tax charge, most of which stemmed from the Trump tax overhaul. It now has 2.13 billion monthly active users and 1.4 billion who use it daily.
Zuckerberg said: “Already last quarter, we made changes to show fewer viral videos to make sure people’s time is well spent. In total, we made changes that reduced time spent on Facebook by roughly 50 million hours every day. By focusing on meaningful connections, our community and business will be stronger over the long term.”