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Meta Platforms’ Revenue Soars as it Faces Criticism Over its Youth Promotional Tactics

Meta Platforms (NASDAQ:META), formerly Facebook, found itself on the wrong end of a legal complaint that was filed by the attorney generals from 33 U.S. states. One of the revelations in a newly unsealed legal complaint showed that Meta Platforms knowingly and deliberately engineered its social platforms to hook children.

The company never disclosed that it had received millions of complaints about underage users on Instagram. However, Meta Platforms only disabled a fraction of those accounts. The documents describe Meta officials acknowledging that the company designed its products to take advantage of the early stages of psychological development in youth. For example, a youth on social media may be more prone to impulsive behaviour, susceptible to peer pressure, and underestimate real risks. The same officials acknowledge that Facebook and Instagram were popular among children under the age of 13, who do not meet age requirements to use the social media service.

For its part, Meta has come out to say that the report misrepresented its approach. The company stated that it has been committed to work to make the Internet and social media spaces safer for children, providing “over 30 tools to support them and their parents”. It also noted that age verification remained a “complex industry challenge”.

This report may offer up some questions that Meta will have to tackle, but it should not prove damaging in the long term. Meanwhile, Meta has continued to post impressive earnings growth in fiscal 2023. In the third quarter (Q3) of fiscal 2023, the company posted year-over-year revenue growth of 23% to $34.1 billion. Net income more than doubled to $11.5 billion or $4.39 per share.

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