Facebook’s Earnings and Revenue Jump, Topping Forecasts

SAN FRANCISCO — Facebook has been targeted by lawmakers over its treatment of political ads and has been misused by Russians to spread disinformation. But on Wednesday, the social network showed those challenges had little effect on its business.

The Silicon Valley company said its revenue in the third quarter rose 29 percent from a year earlier, to $17.7 billion, while profits jumped 19 percent to $6.1 billion. The results surpassed Wall Street estimates.

Facebook also reported 2.8 billion regular users across its family of apps — which includes Instagram, WhatsApp, Messenger and Facebook’s core social network — up from the year previous. More than 1.6 billion people visit Facebook on a daily basis.

Shares in the company rose about 5 percent in after-hours trading.

Facebook’s financial performance is a regular bright spot for the social giant, which has been embroiled in scandals in recent years over the way it handles customer data and the spread of misinformation. Regulators and lawmakers are now examining Facebook’s power and whether it is stifling competition. Senator Elizabeth Warren, a Democrat running for the presidential nomination, has proposed breaking up the company.

The quarterly report is also a brief distraction from the company’s current controversy involving the way it handles political advertising across the service. For weeks, the company has been criticized for a recent decision to not require that ads bought by political candidates be fact-checked for accuracy. Mark Zuckerberg, Facebook’s founder and chief executive, has defended the policy, arguing that Facebook doesn’t wish to be the arbiter of free speech across the platform.

“People having the power to express themselves at scale is a new kind of force in the world — a Fifth Estate alongside the other power structures of society,” Mr. Zuckerberg said in an address delivered to Georgetown students this month.

Facebook has taken significant criticism for the policy on political ads. Internally, employees dissatisfied with the decision wrote an open letter to company executives this week, imploring them to consider revising the decision.

And on Wednesday, Twitter escalated the issue by barring all political advertising from its platform entirely. “Paying to increase the reach of political speech has significant ramifications that today’s democratic infrastructure may not be prepared to handle,” Jack Dorsey, Twitter’s chief executive, tweeted Wednesday afternoon. “It’s worth stepping back in order to address.”

Instead of wavering, Mr. Zuckerberg reaffirmed the company’s position on Wednesday.

“From a business perspective, it might be easier for us to choose a different path than the one we’re taking,” he said on a conference call with investors. “But in a democracy, I don’t think it’s right for private companies to censor politicians, or the news.”

He pushed back on the notion that Facebook chose the policy to support a given political party. And he shot down the idea that Facebook continued to serve the ads out of purely financial motivations. Facebook expects political advertising will contribute less than 0.5 percent of revenue next year, Mr. Zuckerberg said, the first time he has ever cited such a statistic.

“I could be wrong, but my experience running this company so far has been that if we do what we believe is right, even when it’s unpopular for years at a time — then eventually it has worked out best for our community,” Mr. Zuckerberg said.

After the 2016 election and a string of scandals that plagued the company, Facebook saw its revenue growth begin to slow, spooking investors and slicing the company’s market value. But Facebook’s business has mostly kept chugging along. People continued to use the company’s products, and recruiting new employees continues to surge; more than 43,000 people are employed by Facebook. The company expects that employee-related expenses will surge into 2020 to help handle security and regulatory issues.

Although the business continues to grow, David Wehner, Facebook’s chief financial officer, warned analysts on Wednesday that Facebook’s days of blockbuster revenue growth might be slowing. Mr. Wehner said that increased regulatory scrutiny and an emphasis on user privacy might limit Facebook’s ad-targeting tools, and therefore the company’s ability to add to its revenue as rapidly.

Mr. Zuckerberg also announced that Sue Desmond-Hellmann, chief executive of the Bill and Melinda Gates Foundation, would step down from Facebook’s board of directors. Ms. Desmond-Hellmann cited the increasing demands of her work and family life, as well as taking care of her health.