People are spending less time on Facebook — and CEO Mark Zuckerberg claims that’s by design.
Zuckerberg said that people spent “roughly 50 million hours” per day less on Facebook last quarter. Zuckerberg said that “we made changes” in order for that time decrease to happen, and added that “focusing on meaningful connections, our community and business will be stronger over the long term.”
Zuckerberg has pushed for Facebook to be “good for people’s well-being and for society,” and said earlier this month that Facebook was planning to make additional changes to the News Feed that might result in less time spent on the service. But those News Feed changes weren’t yet in effect in Q4, when the 50 million-hour daily decrease took place.
Wall Street seems concerned. Less time spent usually means there is less money coming in as a result. The stock is down 4.8 percent in after-hours trading.
Facebook’s actual numbers were strong. For the last three months of the year, Facebook reported a record sales quarter, amassing $12.97 billion in revenue, more than the $12.54 billion Wall Street was expecting.
But Facebook’s profits were much lower than expected, which the company is attributing to the recent tax overhaul passed by Congress late last year. That change added $2.27 billion to Facebook’s quarterly tax bill.
As a result, Facebook said its earnings per share was lower by 77 cents. Facebook reported profits of $1.44 per share; analysts were looking for $1.95 a share.
Otherwise, the quarter was pretty typical of Facebook. Its total user growth was up 14 percent over the same period last year, to 2.13 billion users, about what was expected. Worth noting, though, is that the company added 32 million daily users over the quarter, its lowest quarter-over-quarter jump in two years.
Facebook’s revenue growth was also strong — up 47 percent over last year. Facebook has been warning Wall Street for more than a year that its revenue growth would start to slow because it was running out of places to put ads in News Feed. That hasn’t really happened, at least not in any meaningful way.
Facebook executives will speak with analysts on a conference call at 5 pm ET and will likely shed more light on the taxes (and if Facebook plans to do anything with its overseas cash pile, which was almost $13 billion at the end of September).
Facebook’s average revenue per daily user is $9.27, up 23 percent from last quarter.
This article originally appeared on Recode.net.