Facebook agonizes over how to re-engage community

In terms of profiting from the digital economy few (if any) have done it better than Facebook, but user numbers are starting to slow. Is Facebook focusing too much on advertising to the detriment of user engagement?
The Facebook business model is simple; make an engaging platform, attract users, build a wall around the community and charge third-parties to access this luscious garden though advertising. It continues to be immensely successful, but is mostly reliant on scale to be the profit-mons