Facebook, Inc. (NASDAQ: FB) No. 2 executive, Sheryl Sandberg, defended the Company in the U.S. Congress on Wednesday morning over what lawmakers see as a failure to combat continuing foreign efforts to influence U.S. politics.
Prior to the hearing, President Donald Trump, in an interview with the Daily Caller, accused social media companies of interfering in the U.S. mid-term elections in November, without appearing to offer any evidence.
As the hearing began, Senator Mark Warner, the committee's Democratic Vice Chairman, said Facebook was not doing enough to stop the flow of foreign influence and threatened Congressional action. After his remarks, social media stocks fell with Facebook moved over 1% lower.
Sandberg acknowledged to the Senate Intelligence Committee that the Company was too slow to respond to Russian efforts to interfere in the 2016 U.S. election and general American political discourse, but insisted it is doing better. She detailed how Facebook is trying to root out foreign interests and shutting down fake accounts. Up to now, Facebook has removed hundreds of accounts involved in coordinated inauthentic behavior. However, Senator Richard Burr, the committee's Republican chairman, still worried about that national security vulnerability from November remains unaddressed.
Facebook have been on the defensive for many months over political influence activity on site as well as concerns over user privacy. Facebook was down 2.8% to USD 170.74 on Tuesday, following a report from Moffett Nathanson that downgrades the stock from “buy” to “neutral” and sets a USD 175 target price slashed from USD 200. And the latest quarterly numbers, especially revenue growth deceleration, coupled with the Company’s long-term margin guidance, don’t provide a convincing support for outperformance. After the release of its Q2 financial results, the Company’s stock price has dropped more than 20% from USD 217 to USD 168 in nearly one month.