Despite the preparation by the social media giant for the payment of a record-setting penalty for settlement of privacy issues with the U.S. regulators, Wall Street seemed to care less as the company announced increased number of users and heightened profit expectations for the first quarter of the current year.

Facebook has been facing probes in the United States as well as in Europe following the revelation of the data sharing scandal involving the political consultancy Cambridge Analytica about a year ago. The sharing of personal data of users of Facebook was done without the consent of the users. The probes included one by a U.S. Federal Trade Commission (FTC) examining whether a 2011 agreement over user privacy had been violated by the social media company.

Following the scandals, a section of the users  tweeted #DeleteFacebook as they shut down their accounts while some companies pulled their ads off the social network. The company lost nearly $70 billion in market value within less than a month as investors showed less confidence the company because its executives forecast spiralling costs of fending off outright regulation.

Currently, the market value of Facebook is $40 billion higher than it was just before the revelation of the scandal. There was a 6 per cent increase in its shares after the company announced a $3 billion litigation accrual in quarterly earnings, excluding which, it beat estimates of the market

“With each fresh scandal, commentators and politicians demand vague action and declare the end is nigh,” said Ben Marder, senior lecturer in marketing at the University of Edinburgh Business School. “All this just solidifies Facebook as a shining example of ‘whatever doesn’t kill you makes you stronger’. Figures show its users are generally happier now, following alterations to the algorithm to give them more ‘meaningful content’.

There was an increase of 8 per cent in the first quarter in the number of users of the app year on year.  Its expense forecast for 2019 was raised by Facebook but there were some concerns because of the financial penalty. Concerns over the actual amount of the fine that would be forced on the company by the FTC and the changes that it would enforce as a part of the settlement in addition to how ad targeting and revenue would be impacted because of the new requirements still persisted among analysis and investors.

He was open to government oversight of social media, Facebook founder and Chief Executive Mark Zuckerberg said in a blog post in March and had added that private messaging is the future of Facebook. WhatsApp-based payments system is also an area of development for the company.

Experts and analysts apparently are accepting the vision of Facebook for its future even though the company has not provided any details about how its ad model would be adapted to the new vision.

“While marketers may say privately that they do worry about Facebook’s problems with fake news, election meddling, privacy and more, they worry more about their own financial health, and Facebook is still a major partner in that regard,” eMarketer analyst Debra Aho Williamson said.

(Adapted from News18.com)