Company shares recover after 'no meaningful' loss of users announcement
Facebook shares have staged a muted recovery from the lengthy and damaging decline the company has suffered over the last three weeks after founder Mark Zuckerberg said the Cambridge Analytica scandal had not had a "meaningful" impact on how many people are using the social network.
The rebound came despite revelations that millions more Facebook users than previously thought may have had their data illegitimately collected by the British election consultants.
Facebook shares opened 4.2pc up, regaining some of the ground they lost since the data controversy first hit the company three weeks ago.
They have climbed more than 5pc since their lowest point of the crisis, although remain more than 10pc below what they were before reports first emerged alleging Facebook had failed to protect users' data. On Wednesday night, Mr Zuckerberg had indicated that the #deletefacebook movement, which urged users to leave the social network, had not spread beyond a vocal core.
"I don't think there has been any meaningful impact we've observed," the Facebook chief executive said.
"But, look, it's not good. I don't want anyone to be unhappy with our services or what we do as a company.
"So, even if we can't really measure a change and the usage of a product, or the business or anything like that, it still speaks to people feeling like this is a massive breach of trust and that we have a lot of work to do to repair that."
Yesterday, Matt Hancock, the UK minister responsible for overseeing internet companies, said the news that more than a million British people may have had their data compromised was "completely unacceptable".
Facebook revealed on Wednesday that an estimated 87 million users around the world had had their personal data harvested by a quiz app downloaded by just 305,000 people because of the way the social network allowed such apps to access data about their friends.
Mr Hancock, the secretary for digital, culture, media and sport, said he would meet Facebook representatives on Wednesday to demand answers. "I expect Facebook to explain why they put the data of over a million of our citizens at risk," he wrote on Twitter.
"This is completely unacceptable, and they must demonstrate that this won't happen again."
The share bump came despite analysts at Morgan Stanley estimating that Facebook's recent efforts to protect people's data would hit its business.
The financial services firm downgraded its price target for the shares.
It said an announcement made last week that advertisers would no longer be able to target adverts based on using information bought from data sellers would mean revenues being 1.6pc lower than previously forecast this year and 4.5pc lower in 2020.
In total, it said it expects combined revenues over the next three years to be $6.9bn (€5.6bn) below forecasts made before the scandal emerged.