Mark Zuckerberg Promises Radical Ad Transparency as Facebook Profit Rockets

Posted November 03, 2017

It's worth noting that more than 98 percent of Facebook's revenue comes from advertising, 88 percent of which is from mobile devices.

At the same time, the company expects higher security costs together with investment in original video content to increase operating expenses by up to 60 percent in 2018, according to CFO David Wehner. Shares were down 2.5 percent during trading hours on Thursday.

The company reported third-quarter net income of $4.7 billion, or $1.59 a share, compared to $2.63 billion, or 90 cents a share, in the year-ago period.

Facebook drew 98 percent of its revenue from advertisements, as ad revenue grew 49 percent year over year. The investment in this area will increase enough that it will impact the company's profitability going forward, Zuckerberg warned analysts.

Daily active users rose 16 percent to 1.37 billion on average for September, while monthly active users increased 16 percent to 2.07 billion.

Facebook's quarterly revenue broke the $10 billion mark for the first time.

Zuckerberg opened today's incomes call with a highly worded guarantee to mark out making use of Facebook for undermining democracy in the U.S. On Russia's use of the social network throughout the 2016 election he stated, "exactly what they did is incorrect, and we are not going to stand for it". "Protecting our community is more important that maximizing our profits".

Even with the expected increased expenses, analysts believe that the security increase will only benefit the company in the long run, but will impact it very shortly.

The latest data on Instagram is on top of the estimated 126 million Americans exposed to Facebook posts from Russian entities seeking to create divisions during the election campaign.

"We already have about 10,000 people working on safety and security, and we're planning to double that to 20,000 in the next year to better enforce our Community Standards and review ads", the tech mogul told investors. Now, many analysts have either remained or begun to change to a bullish position for Facebook, while also raising price targets. Some firms have raised their price targets, such as Morgan Stanley raising it to $200 from $195 and Jefferies raising it from $215 to $225. Intense words, although perhaps what you would get out of a CEO on a day when more than one lawmaker threatened to more greatly regulate Facebook if it couldn't police itself well enough to prevent intervening in USA elections.