Source: Sharecast
The company said in a statement that it will pay the sum to dozens of US states in annual instalments over a 10-year period. The money will be used to fund youth online safety initiatives, among other state priorities, it said.
The agreement with a bipartisan group of 52 attorneys general includes implementing strict daily time limits teens can't turn off, default blocks from the company’s apps at night, muted notifications during school hours, and new controls for parents.
C.J. Mahoney, chief legal officer at Meta, said: "I'm pleased to announce that Meta has reached an agreement with a bipartisan group of state attorneys general from around the country on a new set of rules governing teens' use of social media. The framework we've negotiated will empower parents to easily manage how their children access our platforms.
"Our new Time Limit commitments, Night Mode features and usage limits during school hours set the right path forward for our whole industry, but this framework will only work if all our peers join us. Because teens move fluidly across dozens of apps, we need an industry-wide solution.
"We therefore call on our industry peers, TikTok and YouTube, to implement this new framework, right away. As a parent, I'm proud of both the work Meta has done to protect kids historically, and of this new groundbreaking agreement. But its success depends on all other social media platforms following Meta's lead."
At 1635 BST, the shares were up 2% at $581.48.
Angeline Ong, senior technical Analyst at IG, said: "Meta's muted stock reaction all but confirms the market is reading this as tail risk removed, not the beginning of more legal uncertainty for the social media giant. Shares had already rallied on news that a settlement was near, and around $17 billion settlement instead of Meta's own disclosed worst case of $1.4 trillion is still a deeply favourable resolution. Now that this settlement haze has cleared, the Meta narrative shifts to ‘show me the AI revenue’.
"Near-term catalysts for Meta include Nvidia’s earnings tonight, which could offer another read on whether the huge sums being poured into AI are starting to pay off. Beyond that, investors will be watching the launch of Hatch, Meta’s consumer AI agent platform, expected in the coming weeks, followed by Q3 earnings in late October."