Forgive my stupidity but how does that data translate into profit?
In the broadest sense, any data that tells you something about the interests, purchases, travels, etc. of the user is data that can be sold for marketing purposes. If Instagram has data that says, say, some of our users vacation in Ireland, they might get Aer Lingus to buy ads. You might also recall that FB floated a plan where Instagram would sell content, essentially acting as a microstock agency, but that users (providers of content) would get bupkis. This didn't go over very well.