Facebook expects to be fined $3-5 billion (£2.3-£3.9 billion) by the Federal Trade Commission for privacy violations, the company announced on Wednesday in its financial earnings report.
The fine is a record for the FTC and represents at most a third of quarterly earnings for the Silicon Valley giant who brought in approximately $15 billion in revenue the first quarter of 2019.
“The matter remains unresolved and there can be no assurance as to the timing or the terms of any final outcome,” the company’s financial results said.
The company is under FTC investigation for allegedly violating a 2011 privacy “consent decree” requiring Facebook to notify users and the FTC and to obtain consent from users before sharing data beyond privacy settings. In 2018, it was reported that Facebook allowed an app developer working with Cambridge Analytica to download data on millions of data, as well as news of a data breach impacting over 50 million people. Last March, the Washington Post reported that Facebook’s penalties could add up to “trillions of dollars” if the agreement were enforced to its maximum extent.
Facebook’s sales hit $15.1 billion, slightly topping predictions as the network grew to 1.56 billion users per day and rose eight percent to 2.38 billion users per month.
The company’s costs rose 80.5 percent to $11.76 billion, a rise reflecting investments in content, security and AI across platforms.
Wall Street reacted by pushing Facebook’s stock up nearly six per cent. [Facebook]
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