Is Facebook slipping into the crisis? New numbers worry the internet giant

Facebook’s new course of showing fewer videos to members has quickly led to shorter usage times. That’s why users spent 50 million fewer hours a day on Facebook every day, founder and CEO Mark Zuckerberg said Wednesday. “That shows how seriously we mean it.”

With the size of Facebook that is only about two minutes per user per day. But shorter usage times can also impact on the business figures if less advertising is clicked. Zuckerberg emphasized that this is something that Facebook accepts to make the time spent on the online network more meaningful.

He had already announced a profound change of strategy a few weeks ago, explaining that users are less likely to see news and content from Facebook pages and more posts from friends and relatives instead. “Helping people to connect is more important than extending their time of use,” Zuckerberg said. That’s good for Facebook in the long run.

Facebook sales at a new high
In the past quarter, a booming Internet advertising business pushed Facebook sales to a new high. The online network received nearly $ 13 billion. That was an increase of 47 percent year on year. The profit rose by a fifth to 4.27 billion dollars, as Facebook announced after US market close on Wednesday.

The reason for the more moderate increase was the provision of around $ 2.3 billion for the one-time tax on foreign profits after the US tax reform.

User numbers in the USA are sinking for the first time
Facebook now has 2.13 billion monthly active users. 1.4 billion of them came to the platform every day. That was 32 million more than three months earlier – the slowest growth since 2015. Analysts had expected a faster increase in user numbers.

In the most lucrative market in the US and Canada, the number of daily active users even dropped for the first time, from 185 to 184 million. According to market researchers, the use of Facebook in the region was already declining before the announced conversion. Zuckerberg said the change in strategy was also necessary because of the members’ dissatisfaction with the flood of content.

Facebook expects slower growth
In North America, Facebook made nearly $ 27 in revenue per user over the past quarter, compared to just over $ 6 globally. In Europe, earnings per member were closer to the global average of just under $ 9.

For this year, Facebook expects slower growth of the business than in 2017. At the same time, the cost should rise by 45 to 60 percent. The online network alone wants to invest up to 15 billion dollars in infrastructure such as data centers.

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