WhatsApp Ireland, the Meta-owned messaging app company’s main European corporate entity, slumped to an operating loss of more than €2.4 million last year.
The Dublin-registered company’s expenses surged after it set aside more money to deal with potential regulatory fines.
The Irish company, which the Irish Data Protection Commission (DPC) fined €265 million in 2021 over various breaches of European privacy laws, is responsible for managing the data of its more than 500 million customers across the EU.
WhatsApp Ireland has appealed the DPC’s fine in the High Court, which adjourned the matter earlier this year pending a decision of the Court of Justice of the European Union (ECJ).
Accounts recently filed in Dublin reveal the company sank to an operating loss of more than €2.4 million last year from operating profits in excess of €40 million in 2022. Administrative expenses at the company climbed by €42.2 million in the year to €58 million, eclipsing the messaging giant’s total revenues of €55.3 million.
What to consider when switching to an EV
In a report attached to the accounts, the directors of WhatsApp Ireland said the sharp uptick in expenses was “driven by the impact of measuring regulatory compliance provisions at the present value of the best estimate in the current year compared to prior year”.
The accounts note the company set aside an additional €4.3 million to discharge any potential fines “due to changes in estimates and assumptions”. Overall, the company had a more than €203 million war chest to discharge any fines at the end of last year, up from €193.4 million at the end of 2022, an increase of some €9.7 million.
[ Data Protection Commission fines WhatsApp additional €5.5m over GDPR breachOpens in new window ]
This included the €4.3 million set aside in 2023 and an additional €5.4 million as it reversed previous reductions in the size of its reserve, which had shrunk by €45.3 million in 2022 by way of discounting.
The accounts said: “The best estimate is based on the advice from outside legal counsel, regulatory correspondence received to date including final decisions, relevant mitigating factors, comparison with similar matters and other factors, which under the relevant legislation may impact any final fine amounts.”
WhatsApp Ireland also noted there is “uncertainty... as to when these matters will be resolved”.
[ WhatsApp Ireland sets aside €77.5m for possible data compliance finesOpens in new window ]
Losses after tax reached €8.2 million last year, a plunge from profits of more than €41 million in 2022. The company said it had no further comment on the results.
- Sign up for Business push alerts and have the best news, analysis and comment delivered directly to your phone
- Join The Irish Times on WhatsApp and stay up to date
- Our Inside Business podcast is published weekly – Find the latest episode here
