The social media giant has its share of litigation issues and might face fines that could run into billions of dollars, even as Facebook’s CEO Mark Zuckerberg appears to favor federal regulation that several parties have been advocating in recent times.
Despite its troubles, Facebook has reasons to be optimistic. The company’s advertising revenue is expected to stay strong even as it faces competition from Google and Twitter (TWTR) in the digital ads space, with momentum in mobile advertising.
In spite of the data privacy scandals, Facebook is likely to see a growth in user count, especially from the Asia-Pacific region. The popularity of its existing features like video, coupled with the addition of new features like music, are likely to help improve user engagement.
Last quarter, Facebook topped earnings and revenue estimates, giving the stock a lift of 7% at the time. Earnings grew 65% year-over-year to $2.38 per share, despite the increase in expenses. Revenues grew 30% to $16.9 billion.
Facebook’s shares have gained 35% thus far this year but are still down about 17% from their 52-week high. The stock was up 1.17% in mid-day trade on Monday.