Facebook shares rise despite US senators' grilling of Zuckerberg

 

WASHINGTON/SAN FRANCISCO: Facebook Inc shares rose Tuesday to their highest in almost three weeks as chief executive Mark Zuckerberg fended off questions from US senators on how the social network handles user data and plans to counter attempts at interfering in US elections.

Zuckerberg repeated his Monday apologies for a range of problems that have beset the world’s largest social network, but the 33-year-old internet mogul broke little new ground in a joint hearing of the US Senate’s Commerce and Judiciary committees, raising investor hopes he could forestall strict regulation.

“We are going through a broad philosophical shift at the company,” said Zuckerberg, wearing a dark suit and tie instead of his typical T-shirt and jeans.

Investors appeared to welcome his performance.

“Zuckerberg is conciliatory in his presentation,” said Mariann Montagne, portfolio manager at Gradient Investments in Arden Hills, Minnesota. “The stock is running up on his comments. Maybe people like seeing Zuckerberg in a suit.”

Facebook shares closed up 4.5 percent at $165.04.

Facebook faces a growing crisis of confidence among users, advertisers, employees, and investors after acknowledging that up to 87 million people, mostly in the US, had personal information harvested from the site by Cambridge Analytica, a political consultancy that has counted US President Donald Trump’s election campaign among its clients.

It is also struggling to deal with fake news and alleged foreign interference in elections, disclosing in September that Russians under fake names used the social network to try to influence US voters in the months before, and after the 2016 election, writing about inflammatory subjects, setting up events, and buying ads.

“We believe it is entirely possible that there will be a connection there,” Zuckerberg said when asked if there was overlap between Cambridge Analytica’s harvested user data and the political propaganda pushed by the Kremlin-linked Internet Research Agency during the 2016 presidential election, which Facebook has said was seen by some 126 million people.

On Friday, Zuckerberg, who founded Facebook in his Harvard University dorm room in 2004, threw his support behind proposed legislation requiring social media sites to disclose the identities of buyers of online political campaign ads.