META Meta Platforms Inc

By Jeff Horwitz and Suzanne Vranica 

Facebook Inc. warned that its business is expected to take a hit, even as its products are seeing unprecedented usage as the result of the novel coronavirus pandemic.

The tech giant's announcement is the latest sign of the major blow expected for companies that lean heavily on online advertising, where spending has rapidly dried up in recent weeks.

In a post on Tuesday afternoon, Facebook said total messaging across the platform's services has increased 50% in countries hit hard by the virus, with video messaging more than doubling. In Italy, which has undertaken some of the most intense and sustained restrictions on public life of any country outside China, video calling is up by more than 1000% from a month ago.

But the company said the higher usage wouldn't shield it from expected declines in digital advertising across the globe.

"We don't monetize many of the services where we're seeing increased engagement, and we've seen a weakening in our ads business in countries taking aggressive actions to reduce the spread of COVID-19," wrote Alex Schultz, Facebook's vice president of analytics, and Jay Parikh, vice president of engineering.

The company didn't formally restate its earnings guidance but said "our business is being adversely affected like so many others around the world."

Facebook's announcement -- which also detailed steps the company is taking to increase capacity and reduce the strain that heightened video and calling traffic puts on communications structure -- is in keeping with other recent announcements by advertising-based tech platforms and media of reduced financial targets.

Write to Jeff Horwitz at Jeff.Horwitz@wsj.com and Suzanne Vranica at suzanne.vranica@wsj.com

(END) Dow Jones Newswires

March 24, 2020 17:13 ET (21:13 GMT)

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