By Barbara Ortutay, AP Technology Writer
Facebook capped a tumultuous 2020 with soaring earnings in the final quarter, but the company forecast challenges in 2021 that include a coming privacy update by Apple that could limit the social network's ad targeting capabilities.
The Apple move drew a rare public rebuke from Facebook CEO Mark Zuckerberg, who during a conference call accused Apple of favoring its own interests and not those of users.
Facebook said its already enormous user base grew in the fourth quarter as people stayed home during the pandemic and reported revenues buoyed by a shift to digital advertising amid coronavirus-related economic uncertainty.
But the company predicted uncertainty for 2021 and said its revenue in the latter half of the year could face significant pressure. Because revenue grew so quickly in the second half of 2020, the social network could have trouble keeping up that pace.
"Clearly the pandemic has also continued to help Facebook's monthly active user growth to remain strong in many regions, including in the U.S. and Canada, where prior to the pandemic, user gains had slowed to a crawl," said eMarketer analyst Debra Aho Williamson. But she noted that the number of daily users in this region declined, suggesting that people in the U.S. and Canada are moving elsewhere — probably TikTok, which grew quickly in 2020.
In the conference call with analysts, Zuckerberg came out swinging, saying Apple is fast becoming one of Facebook's "biggest competitors" due in part to its dominance in messaging on the iPhone. Apple, he said, "has every incentive" to use its own mobile platform to interfere with how rival apps work.
Apple will soon require apps to ask users for permission to collect data on what devices they are using and to let ads follow them around on the internet. Facebook has been pushing back against the changes, saying those rules could reduce what apps can earn by advertising through Facebook's audience network.
Of course, the Apple move also threatens Facebook's own advertising revenue. Zuckerberg, though, focused on what he sees as Apple's motives.
"Apple may say that they are doing this to help people, but the moves clearly track their competitive interests," Zuckerberg said.
Apple, meanwhile, says people should be empowered to have more control of their data. Executives have dismissed arguments from advertisers and companies like Facebook who say the anti-tracking feature will hurt the online ad industry.
"When invasive tracking is your business model, you tend not to welcome transparency and customer choice," Apple's software chief Craig Federighi said in December.
Facebook earned $11.22 billion, or $3.88 per share, in the October-December period, well above the $3.19 that analysts expected and up 53% from a year earlier. Revenue grew 22% to $28.07 billion, higher than the $26.36 billion analysts were predicting, according to a poll by FactSet.
Its monthly user base grew 12% to 2.8 billion. Facebook ended 2020 with 58,604 employees, a 30% increase from a year earlier.
While Facebook does not break out how much it makes from Instagram, which it owns, eMarketer estimates that the app accounted for 36% of Facebook's total advertising revenue and nearly half of its U.S. ad revenue.
Sony reports healthy profits on strong sales of sensors and games
Sony's profit rose 69% in July-September from a year earlier on the back of strong sales of its image sensors, games, music and network services, the Japanese electronics and entertainment company said on Friday.
Quarterly profit was 338.5 billion yen ($2.2 billion), up from 200 billion yen in the year-earlier period, while consolidated quarterly sales edged up 3% year-on-year to 2.9 trillion yen ($19 billion).
Tokyo-based Sony's latest quarterly results were boosted by healthy demand around the world for image sensors used in mobile products.
Sales also held up in its video games division. During the latest quarter, 3.8 million PlayStation 5 game consoles were sold globally, compared with 4.9 million units sold the same period a year ago.
Demand remained strong for PS5 game software, according to Sony.
The top-selling music releases from Sony for the quarter included "SOS" by SZA, David Gilmour's "Luck and Strange" and Kenshi Yonezu's "Lost Corner."
One area where Sony's business suffered was its pictures division, including TV shows and movies, which was impacted by production delays caused by the strikes in Hollywood.
Among the recent hit films from Sony was "It Ends With Us," a romantic drama based on a novel.
Sony, which also makes digital cameras and TVs, maintained its 980-billion yen ($6.4 billion) profit forecast for the fiscal year through March 2025, up 1% from the previous fiscal year.
Read More