Facebook Revenue Soars As Time Spent on Platform Plummets

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He said the company was doing this by "encouraging meaningful connections between people rather than passive consumption of content".

Facebook said about 1.40 billion people were using its service daily as of December 31, up 14 percent from a year earlier, compared with analysts' estimate of 1.41 billion, according to financial data and analytics firm FactSet. It had 184 million daily users in this region in the quarter, down from 185 million in the prior quarter.

The $13 billion in sales wasn't enough to satiate Wall Street, however, with shares of Facebook falling more than 4 percent after hours to below $180 a share.

In the third quarter, Facebook grew its ad sales by 47 percent to about $10 billion compared to the same period past year.

"Last quarter, we made changes to show fewer viral videos to make sure people's time is well spent", he said. Though Facebook saw a 14 percent year-over-year increase in daily and monthly active users, it actually dropped from 185 million to 184 million daily users in the U.S. and Canada and stayed at a flat 239 million for monthly users.

RBC Capital Markets analyst Mark Mahaney said his most recent survey of Internet users found a slightly more negative bias towards expected time spent on Facebook. Total costs and expenses of $5.6 billion was an increase of 32% from the year-ago period.

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It was another busy three months for the social network. In November, Zuckerberg said he's "dead serious" about fixing the problem.

Some small publishers may have been left out of today's update, Facebook said, but it plans to refine its algorithms over time to include as many local sources as possible.

People tell us they come to Facebook to connect with friends.

This overload, as he estimates, is due to video material and other content that has gained large dimensions in Facebook over the past 2 years. Facebook said 126 million Americans may have seen Russian-backed political ads and posts.

"The News Feed overhaul and any near-term engagement issues on the platform is ultimately the "right medicine at the right time" as we believe this strategy will drive higher advertising pricing/monetization trends in the long-term for Facebook and was a move Zuckerberg & Co. needed to make", Daniel Ives, chief strategy officer and head of technology research at GBH Insights, wrote in a research note.

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