Moment of weakness for Facebook as investors closely watch the company

investors commitment

The commitment to invest so heavily into "preventing abuse" on the Facebook may cuts into profitability.

Facebook's stock fell 20% Thursday morning after the company said it expects revenue growth to slow as it puts privacy first and restructures its platform.

Facebook's earnings report showed slower than expected growth in user numbers and ad revenue. Revenue hit $13.2 billion for the quarter, up 42% from the same period a year ago but below Wall Street estimates. Although the stock rebounded slightly as the day went on, the news clearly spooked investors.

Facebook broke the law and faces maximum fine for Cambridge Analytica scandal

The earnings report offered a glimpse into how the Cambridge Analytica debacle impacted facebook. News that Cambridge Analytica accessed information from as many as 87 million Facebook users without their permission broke in the final weeks of the first quarter.

earnings report

Thursday's rare moment of weakness came as investors watch the company closely for signs of lasting damage after months of bad press, user outrage and regulatory scrutiny.

Facebook CFO David Wehner said revenue growth may decline as the company prioritizes new formats and is putting privacy first. According to Wehner, the company will invest billions of dollars per year improving safety and security after a bad period of news headlines about Facebook's role in enabling fake news and election meddling.