Facebook took a $3 billion charge in the first quarter, as it “reasonably estimated” that it will be required to pay that much as the FTC looks to punish the company for violating a consent decree on user privacy. Without that charge, Facebook would have easily topped earnings estimates, so after a brief decline in shares during after-hours trading, they jumped back up to a 4% gain.
Amid a constant stream of negative headlines throughout 2018, Facebook FB, -0.65% managed to not only stay afloat but also continue to thrive, with record profit, revenue and user numbers. In the first three months of 2019, amid talk of consequences for Chief Executive Mark Zuckerberg specifically and continuing foibles such as lax internal password storage, the social-media giant continued to defy expectations of a financial penalty for its misdeeds, according to Wednesday’s earnings report.
Facebook reported first-quarter profit of $2.43 billion, or 85 cents a share, on sales of $15.08 billion, after posting earnings of $1.69 a share on sales of $11.97 billion in the same quarter a year ago. Net income would have been $5.43 billion, or $1.89 a share, without the charge for the expected FTC fine. Analysts on average expected earnings of $1.62 a share on revenue of $14.98 billion, according to FactSet.
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