Facebook doubles profit, but sees cooling growth

Facebook on Wednesday reported its profit doubled in the recently ended quarter as digital advertising surged, but warned of cooler growth in the months ahead in an update which sent its share sinking.

Profit jumped to $10.4 billion on revenue of $29 billion, a 56 per cent increase from last year, mainly from a jump in ad revenues, Facebook said in its second quarter report.

The number of people using the social network monthly climbed to 2.9 billion, a year-over-year gain of seven per cent.

"We had a strong quarter as we continue to help businesses grow and people stay connected," Facebook chief executive Mark Zuckerberg said in an earnings release.

However, Facebook shares slipped some three per cent as the tech giant warned that growth was expected to slow due to regulatory actions and a tweak to the iPhone operating software that could hurt its ad targeting.

"We continue to expect increased ad targeting headwinds in 2021 from regulatory and platform changes, notably the recent iOS updates," Facebook said in the earnings release.

The move by Apple early this year has sparked a major rift with Facebook and other tech rivals and could have major implications for data privacy and the mobile ecosystem.

Apple began requiring apps to tell users of its mobile devices what tracking information they want to collect and get permission to do so.

Opting out of being tracked makes it harder for companies such as Facebook to target the ads on which they depend for revenue.

The results come with Facebook and other large tech firms facing heightened scrutiny from antitrust enforcers in the United States and elsewhere for their dominance of key economic sectors.

Facebook won dismissal of a case brought in US federal court last year, but authorities are seeking to refile the case which could potentially lead to a breakup of the social media giant.