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Wall Street may have breathed a sigh of relief at Facebook's third-quarter earnings on Tuesday, but the company has repeatedly been warned that it's not out the woods yet.
After a catastrophic Q2 report, which smells of Facebook shares crashing nearly 24% in July, it is still more stable than ever before.
Wall Street has been reassured that Facebook is moving in the right direction. It was a story of "stabilization," as Deutsche Bank put it.
Read more:Powerful Facebook investors just co-filed a proposal to take over Mark Zuckerberg as chairman
But amidst the relief of rally, Facebook offers loud and repeated warnings that its controversies are not a thing of the past. During its earnings call, the company said 2019 will be a year of significant investment in the "arms race" against security breaches, fake news, and inappropriate content.
Facebook's seemingly perpetual grapple with these issues, when Business Insider revealed that it was able to get a political stance from Cambridge Analytica, the disgraced political consultancy that was banned from Facebook over a giant data breach.
Facebook CEO Mark Zuckerberg told investors that costs will rise to meet this challenge. "The last few years are probably going to be the biggest growth in the investment in the security efforts that we will see," he said on Tuesday's earnings call.
What does that look like in cash? Facebook's total costs and expenses were nearly $ 20.4 billion in 2017 and it has already spent $ 21.2 billion this year, with one quarter to go. Facebook Twitter the protects protects Facebook protects Facebook protects Facebook Facebook Facebook Facebook Facebook Facebook Twitter
And even then, Facebook may never be fixed. Here's the quote quote from Zuckerberg (emphasis bear):
When you're talking about security issues and some of the safety and content issues, These are not problems that we fix, right? They are problems that you manage and try to reduce there's no silver bullet where you do the thing and then you're done. "
Has Facebook become too big?
Michael Connor, the executive director of Open Mic, said, "It's going to be a sign that Facebook has become too big."
"They should be spending, but can they ever spend enough to make the platform safe?" he said. "One of the concerns of a lot of people, it's just too big, and when it's too dominant without enough competition, you wonder if you're unfortunate."
Connor helped coordinate a Facebook shareholder proposal, published on Tuesday, which will be forwarded to the firm's investor meeting in spring of next year. It requests that it publishes a report on its content and its contents. Connor thinks it would focus the minds of top executives on the task ahead.
Activist shareholder Jonas Cron, who is pushing hard for Facebook to fill an independent chairman, welcomed Zuckerberg's commitment to invest in security. "Trillium Asset Management Senior Vice President added.
Facebook COO Sheryl Sandberg summed it up neatly: If people do not trust Facebook, they will not use it. That means the company must throw money at building its defenses, even if making them impenetrable is impossible.
Protecting people's privacy is incredibly important because it's so important that they can be trusted to protect their privacy and security. said.
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