Mark Zuckerberg angrily fired back at a torrent of bad press on Monday, accusing whistleblowers and reporters of plotting against the company as it posted better-than-expected quarterly profits.
“My view is that what we are seeing is a coordinated effort to selectively use leaked documents to paint a false picture of our company,” Zuckerberg said in a Monday call with investors.
Zuckerberg was fighting back against recent news reports on Facebook struggling to crack down on human trafficking, doing little to address hate speech and making mental health issues worse for teen girls.
Whistleblower Frances Haugen and other critics have argued that the company let these issues fester as they prioritized growth — an idea Zuckerberg rejected.
“It makes it a good soundbite to say that we don’t solve these impossible tradeoffs because we’re just focused on making money, but the reality is these questions are not primarily about our business, but about balancing different difficult social values,” the CEO said. “We believe that our systems are the most effective at reducing harmful content across the industry.”
Zuckerberg even appeared to accuse Haugen and journalists of unfairly punishing Facebook for studying the effects of its own platform.
“I worry about the incentives that we are creating for other companies to be as introspective as we’ve been,” said Zuckerberg in apparent reference to Haugen leaking Facebook’s damning internal studies.
Facebook posted $3.22 in earnings per share during the third quarter, slightly outperforming analyst expectations of $3.19, according to Refinitiv. Facebook shares spiked 3 percent in after-market trading on the news.
In a more immediate threat to the company’s bottom than Haugen, Facebook is facing down Apple iOS privacy changes that limit Facebook’s access to the user data that it uses to target ads.
Even as the company’s advertising revenue surged 33 percent to $28.3 billion in the third quarter, Facebook acknowledged in its earnings release that the company will continue to face “continued headwinds from Apple’s iOS 14 changes” in the future.
“The accuracy of our ad targeting decreased,” said Facebook Chief Operating Officer Sheryl Sandberg.
“Facebook continues to power through the storm with its motorization but Apple iOS remains the dark clouds ahead,” Wedbush Securities managing director Dan Ives told The Post.
Facebook is looking to dramatically expand its augmented and virtual reality business as part of Zuckerberg’s push into the “metaverse.” Underscoring that ambition, the company said that would begin report separate financials for “Facebook Reality Labs” — which includes its augmented and virtual reality reality business — and the “Family of Apps” like Facebook, Instagram and WhatsApp beginning next quarter.
Facebook is also under siege from antitrust authorities and bipartisan lawmakers in Washington, D.C. who want to regulate — or even break up — the company, which also controls Instagram, WhatsApp and virtual reality company Oculus.
Leaked documents with detailed statistics on Facebook’s global reach are likely to give fuel to antitrust regulators in the US and overseas, Politico reported.
“There’s a lot to regret in these documents if you are Facebook,” a former Federal Trade Commission staffer told the outlet.
There looks to be no end in sight for Facebook’s whistleblower. Haugen is set to testify in the European Parliament in November — and another company whistleblower reportedly filed a complaint with the Securities and Exchange Commission on Friday, accusing company leadership of blowing off concerns about hate speech.
Yet while Facebook has faced a “tsunami of bad news” in regard to regulation, Apple’s privacy changes are ultimately a bigger threat to the company, according to Ives.
“Apple’s data privacy issues can do more damage that regulators,” Ives said.
Other leaked documents showed that young people are generally spending less time on Facebook, fewer teens are signing up and many new teen accounts are duplicates as opposed to unique new users.
In an effort to address that issue, Zuckerberg said the company is changing its focus to put 18 to 29 year-olds as its “North Star.”