Facebook posted strong financial numbers for its fourth quarter despite growing public outrage over the company’s privacy practices. Net income totaled $6.88 billion, a record profit for the company and an increase of 61 percent.
Facebook is however expecting revenue deceleration for the first quarter of 2019 and projecting full-year expenses to jump between 40 percent and 50 percent from the full year of 2018.Daily active users and monthly active users during the December quarter exactly matched expectations, each jumping 1.8 percent quarter over quarter, and 8.6 percent year over year. The increases represent slower growth than in recent quarters but still indicate that the company’s data scandals and public privacy disclosures haven’t dinged engagement too drastically.
The company previously warned its investment in Stories could contribute to slowing revenue growth during the second half of 2019. Third-quarter revenue grew by 32.9 percent year over year, breaking a 12-quarter streak of growth rates above 40 percent.
Revenue for the December quarter of $16.91 billion marks a year-over-year growth rate of 30.4 percent.Facebook has been dumping cash into its long-form Instagram product called IGTV, its Craigslist competitor called Facebook Marketplace and its dedicated video tab called Facebook Watch. Zuckerberg said on the earnings call users spend an average of 20 minutes a day on the Watch tab. The company expects Watch to surpass 400 million monthly active users in 2019.
The company’s payments and other fees revenue, which includes online game purchases and peer-to-peer transactions on the platform, skyrocketed 46 percent quarter over quarter during the fourth quarter to $274 million.
Zuckerberg indicated the company will push further into commerce across its platforms, helping vendors advertise and sell to users.
Facebook reported capital expenditures of $4.37 billion for the fourth quarter and of $13.92 billion for the full year 2018 — roughly double the quarterly and full-year capital expenditures it reported this time last year.
It posted free cash flow of $3.32 billion for the fourth quarter, down from $4.15 billion during the third quarter and $5.05 billion in the year-ago quarter.