The FTC said last year it was investigating reports that the British consulting firm Cambridge Analytica improperly gained access to the data of tens of millions of Facebook users.
Facebook said on Wednesday that a federal investigation into its privacy practices could cost the company as much as $5 billion.
In its quarterly results reported to investors, Facebook said that for now it was setting aside $3 billion to pay in potential penalties to the Federal Trade Commission but that the eventual number could be much higher by the time the FTC's investigation is over.
"We estimate that the range of loss in this matter is $3.0 billion to $5.0 billion. The matter remains unresolved, and there can be no assurance as to the timing or the terms of any final outcome," the company said.
The FTC said last year it was investigating reports that the British consulting firm Cambridge Analytica improperly gained access to the data of tens of millions of Facebook users, seven years after Facebook agreed to improve its privacy practices to settle an earlier dispute with the FTC.