Facebook Beats Wall Street Q1 Estimates, Reveals $3B Hit From FTC Probe

Facebook Beats Wall Street Q1 Estimates, Reveals $3B Hit From FTC Probe

The investigation is about Facebook's privacy practices and whether the company violated a legal agreement it had with the U.S. government to keep user data private.

Interested in Facebook? Add Facebook as an interest to stay up to date on the latest Facebook news, video, and analysis from ABC News. Facebook's total revenue for the first quarter stood at more than $15 billion.

The probe has focused on whether the sharing of data and other disputes violated a 2011 agreement with the FTC to safeguard user privacy.

Shares of Facebook rose 10 percent to $200.50 in after-hours trade, demonstrating the company's resilience despite a series of scandals over improperly shared user data and propaganda that made it the target of political scrutiny across the globe.

"This is a significant development, and any settlement with the FTC may impact the ways advertisers can use the platform in the future", eMarketer Principal Analyst Debra Aho Williamson said in a note. Facebook and the FTC have reportedly been negotiating over the settlement, which will dwarf the prior largest penalty for a privacy lapse, a $22.5m fine against Google in 2012. The 87 million profiles received by Cambridge Analytica were reportedly used to created profiles of voters used by the 2016 Trump campaign to determine the areas of the country where more money needed to be spent for advertising. Ireland is Facebook's lead privacy regulator for Europe. This compares to the year-ago quarter when earnings came to $1.69 per share on revenue of $11.97 billion. Analysts had expected earnings per share of $1.62 on revenue of $15 billion.

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The company's shares lost a third of their value past year, after executives first warned about costs associated with its drive to improve safety and slowing growth in revenue and operating margin.

Facebook CEO Mark Zuckerberg speaks during the F8 Facebook Developers conference on May 1, 2018, in San Jose, Calif.

Tallies of both daily and monthly active users both increased 8%, with DAUs at 1.56 billion and MAUs at 2.375 billion.

The Facebook Inc. logo is displayed on an Apple Inc. iPhone in this arranged photograph taken in Greenwich, Connecticut, U.S., on Monday, April 23, 2019.

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