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Facebook expects multibillion-dollar FTC fine, but stock still gains after earnings

Facebook Inc. shares jumped nearly 10% in late trading Wednesday, even as the company said it expects to pay a multibillion-dollar fine to the Federal Trade Commission.

Facebook took a $3 billion charge in the first quarter, as it “reasonably estimated” that it will be required to pay that much as the FTC looks to punish the company for violating a consent decree on user privacy. Without that charge, Facebook would have easily topped earnings estimates, so after a brief decline in shares during after-hours trading, they jumped back up.

“We estimate that the range of loss in this matter is $3 billion to $5 billion,” Facebook disclosed in its news release.

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