Facebook surpassed Wall Street’s quarterly revenue and profit expectations on Wednesday, but warned that because Apple’s new privacy policy will make ad targeting more difficult, its growth may drop “significantly” later this year.

During the pandemic, the surge in digital advertising spending when consumers shop online, as well as higher advertising prices, caused Facebook’s revenue to soar by 48%. Looking ahead, the world’s largest social network said that it will focus on building e-commerce functions to expand its advertising business.

In the extended transaction, Facebook’s stock price rose by 6.5% to $326 (approximately Rs 24,140).

Facebook CEO Mark Zuckerberg (Mark Zuckerberg) said on the earnings call with analysts: “We have a long way to go to build a fully functional business platform… but I am very committed to Achieve this goal.”

In the first quarter ended March 31, total revenue (mainly including advertising sales) increased by 48% to US$26.17 billion (approximately Rs 19,380 crore), exceeding the average analyst estimate of US$23.67 billion (approximately 175.28 billion rupees). , According to Refinitiv’s IBES data.

During the pandemic, the digital advertising industry flourished as consumers stay at home and shop online, benefiting Facebook and other companies including Google. Google’s parent company Alphabet announced a record quarterly profit on Tuesday.

Jesse Cohen, a senior analyst at Investing.com, said: “Despite the many disadvantages, such as ongoing antitrust review, ongoing privacy issues, and imminent changes that may have a negative impact on the advertising business, Facebook has achieved another sensational quarter.”

Zuckerberg said the company plans to focus on three key areas: building augmented and virtual reality, e-commerce features, and helping content creators make money on the Facebook platform.

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Monthly active users on Facebook increased by 10% to 2.85 billion.

Net income in the first quarter was US$9.5 billion (approximately Rs 70,360 crore), or US$3.30 per share (approximately Rs 240), and US$4.9 billion (approximately Rs 36,290 crore), or Rs 1.71 per share ( Approximately rupee). 130).

Facebook said that because it has invested in consumer hardware products such as Oculus virtual reality headsets, its total expenditure for the year will range from US$70 billion (approximately Rs 5,18,670 crore) to US$73 billion (approximately 5,18,670 crore). 40,900 crore). And infrastructure.

Apple changes

Facebook said on Wednesday that it expects changes in iPhone privacy rights to affect the second quarter, but revenue growth in the third and fourth quarters may decline quarter-on-quarter.

Facebook criticized Apple because it asked iPhone app developers to start soliciting user permission to collect certain data for advertisements. Facebook said this change will hurt its business and hurt small companies that rely on personalized advertising.

Its efforts to establish shopping and e-commerce functions in Facebook and Instagram are expected to generate additional revenue for the company and make its advertising resources more valuable.

The company recently introduced many new features, including a membership program that allows content creators to earn a certain amount of sales revenue by recommending products on Instagram.

Earlier this month, Facebook announced that it would build a series of audio products, including a live audio room, to rival the popular app Clubhouse and in-app music and podcast players.

The company faces major antitrust lawsuits from a large number of states and the Federal Trade Commission in the United States, and is often criticized by legislators and rights organizations due to its content review policy, algorithmic system, and handling of user rights. Therefore, its power is still under attack. Critical review. data.

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