Facebook loses users in the US and Europe and that hurts
Facebook presented the quarterly figures and for the first time a kind of reaction is visible on the large number of scandals and problems that the social media giant has had in recent times. Facebook has been complaining about for a while, but it did not seem to have an impact on users and especially on advertisers.
Now there is finally a dip, if you can call it that. The number of daily active users has simply increased, but only by 1.5 percent compared to the last quarter. That is not only lower than expected on Wall Street, but also the slowest growth ever. But still: it is still growth. The same applies to the advertising income, because they did not grow enough according to the taste of investors and the stock market. This has meant that the Facebook share has dropped by almost a quarter, causing 147 billion dollars worth of (virtual) value to go up in smoke.
Advertising income at risk
Facebook itself already indicated that the growth in advertising would only be less, because users have now been given the tools to keep their data private and that will ensure that there is still less advertising revenue will come. However, that is all still manageable. A bigger problem is that the move to stop Facebook is very slow, but it is definitely coming to a head, because Facebook is losing people, especially in the US and Europe.
The daily active users have dropped by 3 million, which is almost nothing like the number of Facebook users. However, it is the first time in almost five years that this has happened. If the trend continues it can seriously hurt, because even though America and Europe account for only a third of the daily active users, they account for almost three-quarters of Facebook’s turnover.
No panic
All this does not mean that Facebook is in trouble: all lines just go up and with 13 billion dollar sales they are not on their side, but the rack seems there to be out. It seems mainly that investors on the stock market are slowly starting to get what many users already know: Facebook has a lot of issues that are far from resolved and more and more people reward that with less use of the site. Despite the fact that calls to stop altogether with the service are not yet very successful the reputation of Facebook is steadily declining. We will know in a month or three whether the trend continues.