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Facebook warns it is ‘underreporting’ iOS ad results amid Apple privacy changes By Reuters


© Reuters. FILEPHOTO: This is a 3D illustration of the Facebook logo in Zenica in Bosnia and Herzegovina on May 13, 2015. REUTERS/Dado Ruvic


By Sheila Dang

(Reuters) – Facebook Inc (NASDAQ:) said on Wednesday it is underreporting the results of its advertising business on Apple Inc (NASDAQ:) iOS devices, acknowledging that recent privacy changes from the iPhone maker have made it more expensive and difficult for brands to advertise on Facebook.

In morning trading, shares of the social media company fell 3.7% to $344.32.

Facebook stated in a blog that it believes it underreports “conversions” (an industry term that refers to the buying of products and other actions taken by people after viewing an advertisement). The figure varies among advertisers.

Facebook stated that it believes actual conversions, such as app downloads and sales, are greater than what is reported.

The announcement comes as Facebook and the larger digital advertising industry continues to grapple with the privacy controls implemented by Apple in April, which are designed to limit digital advertisers from tracking iPhone users for advertising purposes without their consent.

Facebook fought back against the changes, arguing it would hurt small businesses that rely on targeted advertising to find new customers.

Investors were previously advised by the social media giant that the Apple changes would have a greater impact on Facebook’s advertising business in the third quarter than the second.

Facebook posted Wednesday’s blog posting describing steps that advertisers can take to measure their ads’ results. Facebook said that it will invest in new capabilities and tools to assist brands marketing during the Apple changes.

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