The company now has 196 million users in North America, down slightly from 198 million in the previous quarter.
The growth spurt that Facebook experienced at the beginning of the new coronavirus pandemic seems to be slowing down. User growth in the U.S. and Canada (the company's most lucrative advertising market) is declining. This was reported by Facebook in its third quarter results. The company now has 196 million users in North America, down slightly from 198 million in the previous quarter. In a release, the company said the decline was expected to continue through the end of the year.
The company had already reported a strong growth surge earlier in the year due to the widespread Covid-19. However, Facebook is not experiencing the same slowdown everywhere. The social network continues to add new users in Asia and its "rest of the world" markets. Its user base in Europe remained stable at 305 million active daily users for the third consecutive quarter. The company also continued to promote its "family of applications", which combines Facebook, Instagram, WhatsApp and Messenger. The number grew to 2.54 billion "active daily users" in September, according to the company.
The slowdown also does not appear to have affected Facebook's revenues, which reached $21.4 billion for the quarter, a 22% increase over last year and above analysts' expectations. Facebook reported more than $18 billion in advertising revenue in the last quarter, despite a high-profile advertiser boycott. In addition, the company now has 10 million active advertisers, said CEO Mark Zuckerberg. That's up from $9 million in July. The boycott included more than 1,000 advertisers who interrupted social network advertising during July to protest the company's hate speech and misinformation policies.
In a call to analysts, CEO Mark Zuckerberg highlighted Facebook's work in preparing for the upcoming election and said he was concerned about the possibility of "civil unrest" after election day. The company has taken many steps in recent weeks and months to prepare for the election, such as banning political advertising after election day and cracking down on the Qanon movement.
"I fear that with our nation so divided and with election results that could take days or weeks to finalize, there is a risk of civil unrest throughout the country," said Mark Zuckerberg.
Facebook expects its advertising revenue growth rate in the fourth quarter to be higher than in the third quarter due to demand during the holiday season, the company said.
Facebook's "other" revenues were $249 million for the quarter, down 7% from a year ago. This includes sales of Oculus virtual reality headsets and the network's video conferencing devices. However, the company reported that sales of the Oculus Quest 2 were strong and could benefit its "Other" revenues in the fourth quarter.
Despite Apple's decision to delay ad tracking changes on iOS 14, Facebook still anticipates that this could be an issue. In addition, Facebook expects more significant targeting and measurement headwinds in 2021. This includes headwinds related to platform changes, including Apple's iOS 14, as well as those related to the changing regulatory landscape.