TOP NEWS: Facebook Anticipates USD3 Billion Fine Over Privacy Lapses.
WASHINGTON (Alliance News) - Facebook Inc is bracing for a possible fine of up to USD3 billion from the US government after being rocked by scandals over its failure to protect user privacy.
The anticipated fine is reflected in the company's earnings statement for the first quarter of 2019, which was released Wednesday.
"In the first quarter of 2019, we reasonably estimated a probable loss and recorded an accrual of USD3 billion in connection with the inquiry of the [Federal Trade Commission] into our platform and user data practices," the statement said.
The federal investigation was launched following the Cambridge Analytica scandal, which involved violations of a consent decree on user privacy.
The company estimates that the range of the loss due to the privacy violations to be between USD3 billion and USD5 billion, it said.
"The matter remains unresolved, and there can be no assurance as to the timing or the terms of any final outcome," the statement said.
Facebook reported that setting aside the USD3 billion pushed earnings down to USD2.43 billion in the quarter against the nearly USD5 billion in net income in the same period a year earlier.
Sales rose 26% year-on-year to more than USD15 billion, and Facebook's cash reserves grew to more than USD45 billion. The number of monthly active users also increased from 2.32 billion to 2.38 billion.
"We had a good quarter and our business and community continue to grow," said Mark Zuckerberg, the company's founder and chief executive. He added the company is focused on its "privacy-focused vision" for the future.
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|Date:||Apr 25, 2019|
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