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Facebook forecasts Q4 revenue below estimates as Apple's privacy rules bite



© Reuters. FILE PHOTO: 3D-printed Facebook logo is seen placed on a keyboard in this illustration taken March 25, 2020. REUTERS/Dado Ruvic/Illustration

(Reuters) -Facebook Inc on Monday warned that Apple Inc (NASDAQ:)’s new privacy rules would weigh on its digital business in the current quarter, after the social media company reported quarterly revenue below market expectations.

The company expects fourth-quarter revenue to be in a range of $31.5 billion to $34 billion. Analysts had forecast $34.84 billion in revenue, or a 24.1% jump, according to IBES data from Refinitiv.

Its third-quarter revenue too faced the brunt of Apple’s privacy rules that kept digital advertisers from using its ad services.

Facebook (NASDAQ:) said that starting in the fourth quarter of 2021, it would break out Facebook Reality Labs (FRL), the part of its business that works on augmented and virtual reality, as a separate reporting segment from its family of apps.

Chief Financial Officer David Wehner said Facebook expected its investment in FLR to reduce its overall operating profit in 2021 by approximately $10 billion.

Shares of the California-based company were up 0.7% in extended trading.

The company’s total revenue, which primarily consists of ad sales, rose to $29.01 billion in the third quarter from $21.47 billion a year earlier, missing analysts’ estimates of $29.57 billion.

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