Facebook culminated in a tumultuous 2020 with growing gains in the last quarter, but the company anticipates challenges in 2021 that include an privacy update by Apple that could limit social network ad targeting capabilities.
Apple’s move sparked a rare public disapproval of Facebook CEO Mark Zuckerberg, who during a conference call accused Apple of furthering its own interests and not those of users.
Facebook said its huge user base grew in the fourth quarter as people stayed home during the pandemic and reported revenue driven by a shift to digital advertising amid economic uncertainty related to the coronavirus.
But the company predicted uncertainty for 2021 and said its revenue during the second half of the year could come under significant pressure. Because revenue grew so rapidly in the second half of 2020, the social network could have trouble keeping up.
“Clearly, the pandemic has also continued to help the growth of monthly active Facebook users stay strong in many regions, including the United States and Canada, where before the pandemic, user gains had slowed. to a crawl, ”said eMarketer analyst Debra Aho Williamson. But he noted that the number of daily users in the region has declined, suggesting that people in the United States and Canada would move to another location, probably TikTok, which grew rapidly in 2020.
In the phone conference with analysts, Zuckerberg went down, saying Apple is fast becoming one of Facebook’s “biggest competitors,” in part because of its dominance in messaging on the iPhone. Apple said it “has every incentive” to use its own mobile platform to interfere with the operation of rival applications.
Apple will soon require apps to ask users for permission to collect data about the devices they use and let ads follow them on the Internet. Facebook has been backtracking on the changes, saying these rules could reduce what apps can get by advertising through Facebook’s public network.
Of course, Apple’s move also threatens Facebook’s advertising revenue. Zuckerberg, however, focused on what he considers Apple’s motives.
“Apple may say it does it to help people, but the moves clearly follow its competitive interests,” Zuckerberg said.
Meanwhile, Apple says people should have the power to have more control over their data. Executives have dismissed the arguments of advertisers and companies like Facebook that the anti-tracking feature will hurt the online advertising industry.
“When invasive tracking is your business model, you don’t embrace transparency and customer choice,” Apple software chief Craig Federighi said in December.
Facebook earned $ 11.222 billion, or $ 3.88 per share, in the October-December period, well above the $ 3.19 analysts expected and up 53% from the previous year. According to a FactSet survey, revenue grew 22%, to $ 28.07 billion, above projected $ 26.36 billion.
Its monthly user base grew by 12% to 2.8 billion. Facebook ended 2020 with 58,604 employees, 30% more than the previous year.
While Facebook doesn’t find out how much it gets from Instagram, which it has, eMarketer estimates that the app accounted for 36% of Facebook’s total advertising revenue and nearly half of its advertising revenue in the United States.
Shares of the Menlo Park, California-based company amounted to $ 1.23, to $ 273.37, in overtime trading. The share price increased by 33% in 2020.