Jim Cramer Breaks Down Facebook Earnings
Facebook is expecting a fine of between $3 billion to $5 billion from the Federal Trade Commission, which is investigating whether the social network violated its users' privacy.
The announcement was made during its first quarterly report on April 24.
Investors reacted with relief when the news was released, pushing the company's shares up more than 7 percent in after-hours trading on Wednesday.
Investors were clearly not the only ones that reacted with relief, Jim Cramer, reacted to the news on his Twitter account.
Facebook Legal Woes =library fine — Jim Cramer (@jimcramer) April 25, 2019 While speaking with Action Alerts Plus investing club research analyst Zev Fima, Cramer added, "I just come back and I just say to myself, oh, phew, only three to five, let's put this thing past us.
The conference call was really a love song to privacy." The fine won't damage Facebook financially, but is big enough for the company to feel the weight.
The $3 billion Facebook set aside to pay the fine reduced first-quarter profit by more than half and will cut the company's cash reserves by seven to 11 percent.
Facebook is Real Money's Stock of the Day.
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