Here's a few things we learned about Facebook today: It's growing like mad. It announced a net income of nearly a half a billion dollars and roughly three quarters of a billion people log on and actually use the service every day.
This was the news Facebook shared in its earnings report. Today should have been a good day.
And YET, starting this morning, Facebook has, rather inexplicably, been on the losing end of the tech news cycle. Multiple times!
It began early, with a Wall Street Journal article where, for unknown reasons, Facebook's communications team let analytics chief Ken Rudin say this:
New types of data Facebook may collect include "did your cursor hover over that ad … and was the newsfeed in a viewable area," Mr. Rudin said. "It is a never-ending phase. I can't promise that it will roll out. We probably will know in a couple of months"
Ultimately, a story designed to herald some new back-end advances in Facebook's ad technology rolled out with the headline: "Facebook Tests Software to Track Your Cursor on Screen" and was passed around the internet as another example of "creepy Facebook." Probably best not to refer to your increasingly refined ability to track people as "a never-ending phase."
Then market research group Forrester issued a devastating report on the social network, stating, quite bluntly that "Facebook is failing marketers" :
Facebook hasn't revolutionized marketing; in fact, it now does little to support social experiences between brands and customers. Instead, it has quietly become almost entirely reliant upon Web 1.0-style display ads and simplistic targeting — and marketers say those display ads just aren't working.
Ouch.
Then came the earnings call, where CFO David Ebersman dropped this clunker in response to questions about "youth engagement":
We remain close to fully penetrated among teens in the U.S.
The Result:
Wait, how many daily active users? I'm having trouble remembering after that last bit about the teens.
These 12 words just cost Facebook $18 billion of value: "We did see a decrease in daily users specifically among younger teens." $FB
Dennis K. Berman
@dkberman
These 12 words just cost Facebook $18 billion of value: "We did see a decrease in daily users specifically among younger teens." $FB
But it was much worse than that — he went on to admit, for the first time, that young teen Facebook engagement was dropping. This would be small news if not for long-simmering suspicions that young people are moving on from the social network — this sliver of confirmation was disastrous.
Facebook stock now only up 2%. Was it CFO saying usage among U.S. teens is stable, but acknowledging a decrease in daily users?
Jessica Guynn
@jguynn
Facebook stock now only up 2%. Was it CFO saying usage among U.S. teens is stable, but acknowledging a decrease in daily users?
Maybe the PR team can smooth things over with some teen-friendly Instagram news. There's got to be something exciting to report, right?!
Uh, nevermind.
Update, 9:50 PM: A Facebook representative reached out to BuzzFeed to clarify Rudin's WSJ statements:
Like most websites, we run numerous tests at any given time to ensure that we're creating the best experience possible for people on Facebook. These experiments look at aggregate trends of how people interact with the site to inform future product decisions. We do not share this information with anyone outside of Facebook and we are not using this information to target ads.