NEW YORK (NYTIMES) - Facebook said on Monday (Oct 25) that revenue rose 35 per cent to US$29 billion (S$39 billion) in the three months ending in Sept 2021 compared with the same period last year, while profits rose 17 per cent to US$9.2 billion, a sign of the social network's financial strength as it faces a public relations crisis over troubling disclosures made by a former employee.
Advertising revenue, which is responsible for the vast majority of Facebook's income, rose 33 per cent to US$28.3 billion. "Other" revenue, which consists largely of sales of Facebook's virtual-reality Oculus hardware, rose 195 per cent to US$734 million.
Some 3.6 billion people now use one of Facebook's apps every month, up 12 per cent from a year earlier.
"We made good progress this quarter and our community continues to grow," said Mr Mark Zuckerberg, Facebook's founder and chief executive.
"I'm excited about our road map, especially around creators, commerce and helping to build the metaverse," he added, referring to a vision of the future espoused by technologists in which disparate parts of the digital world will merge with portions of the offline world. Mr Zuckerberg has said he hopes for Facebook to be known as a "metaverse company" in the years ahead.
The results were a continuation of the company's strong financial performance during the coronavirus pandemic, which has pushed people indoors toward their computers and other devices.
In recent weeks, though, Facebook has faced intensifying political pressure. Ms Frances Haugen, a former employee turned whistleblower, has shared thousands of pages of internal documents and has said that the company chose "profits over people".
The disclosures by Ms Haugen, first publicised in The Wall Street Journal, ignited a firestorm of criticism from lawmakers, regulators and the public. Lawmakers have focused largely on reports showing how Facebook knew Instagram was worsening body image issues among teenagers, among other issues.
On Monday, more than a dozen news organisations, including The New York Times, published articles based on the Facebook Papers, a cache of documents Ms Haugen took before she left the company. A few hours later, she testified before British lawmakers, saying that the company was unwilling to stop the harmful aspects of its products because doing so could jeopardise profits and growth.
Executives have pushed back vociferously on the coverage. "My view on what we are seeing is a coordinated effort to selectively use leaked documents to create a false picture about our company," Mr Zuckerberg said in a call with investors Monday.
"Any honest account should be clear that these issues aren't just about social media," he added. "That means that whatever Facebook does, we're never going to solve them alone."
Facebook appears to be setting itself up for long-term, expensive growth plans. The company said it would break out its Facebook Reality Labs segment into a different reporting unit on its quarterly earnings statements. That segment will be separate from the rest of the company's so-called "Family of Apps" - Instagram, WhatsApp, Messenger and Facebook proper.
Facebook Reality Labs (FRL) is heavily investing in technologies such as virtual and augmented reality. Mr Zuckerberg's long-term goal is that the department helps Facebook become a significant player and creator of the so-called metaverse. But, right now, the unit spends more than it makes - and it will for some time.
"We are committed to bringing this long-term vision to life and we expect to increase our investments for the next several years," the company said in its earnings statement.
Facebook expects FRL to bring down its overall 2021 profits by close to US$10 billion, but Mr Zuckerberg said he expected the metaverse would bring a "massive creator economy" over the long term. The next few years, he noted, will be spent building the infrastructure to support his vision.
The company is also retooling some of its advertising systems to deal with recent changes to Apple's mobile operating system, iOS, which has limited the amount of information that companies like Facebook can learn from iPhone owners.
Ms Sheryl Sandberg, Facebook's chief operating officer, said the company was building a way to do advertising analysis with less information from users.
Shares of Facebook jumped 2.6 per cent to US$337.25 in after-hours trading.
