Business Matters: Signs That Teen Interest in Facebook Is Fading

Facebook's stickiness has come into doubt this week after signs that some teens are ditching Facebook in favor of other social media services. The latest evidence came directly from Facebook Wednesday afternoon. The company revealed in its third quarter earnings call it has lost some popularity with younger users. "We did see a decrease in daily users specifically among younger teens," said CFO David Ebersman during the call.

Facebook 3Q Earnings Fly Past Expectations But Losing Young Teens

Shares of Facebook rose 15.5% in after-hours trading on news the company grew revenue 60% to $2 billion and posted a net income of $621 in the quarter. But worries about shifts in Facebook usage wiped out those gains. An hour later, shares were up less than half a percent from Wednesday's close. 
Facebook's revelation wasn't the only evidence that teen interest is waning. The latest bi-annual teen survey by PiperJaffray shows Twitter has surpassed Facebook as teen's favorite social media service for the first time. The percent of teens who favor Facebook dropped to 23% from 42% just a year ago while Twitter fell to 26% from 27% last fall. Instagram, the Facebook-owned photo-sharing service, climbed to 23% from 12% last fall.
PiperJaffray's survey results don't necessarily mean teens are fleeing Facebook. As Pew Internet noted in August, teens are diversifying their social media habits and their relationship with Facebook is "complicated." The Pew survey found that 94% of teen social media users have a Facebook profile, and Facebook is the main social media service for 81% of those teens. Although services like Instagram -- owned by Facebook, by the way -- and Twitter are gaining popularity, Pew says "teen usage of Facebook still dwarfed every other platform at the time of our survey." 
But Facebook clearly is starting to have some problems -- however slight -- with teen usage. That affects everybody from brands, whose advertising dollars will have to follow teens to other platforms, to artists, who rely on Facebook for communicating with fans.