Meta shares popped in prolonged trading on Wednesday after the corporate reported fourth-quarter revenue that topped estimates and announced a $40 billion stock buyback. Listed below are the outcomes.
- Earnings: $1.76 per share
- Revenue: $32.17 billion vs $31.53 billion expected, in accordance with Refinitiv
The corporate also reported restructuring charges for its Family of Apps segment and Reality Labs unit of $3.76 billion and $440 million, respectively through the fourth quarter of 2022. Due to those charges, it’s difficult to match the corporate’s earnings per share to analyst estimates of $2.22 per share.
Listed below are another key numbers:
- Every day Lively Users (DAUs): 2 billion vs 1.99 billion expected, in accordance with StreetAccount
- Monthly Lively Users (MAUs): 2.96 billion vs 2.98 billion expected, in accordance with StreetAccount
- Average Revenue per User (ARPU): $10.86 vs $10.63 expected, in accordance with StreetAccount
Revenue within the fourth quarter fell 4% from a 12 months earlier, marking a 3rd straight quarter of declining sales. The corporate’s cost and expenses ballooned 22% year-over-year to $25.8 billion.
Anwar Almojarkesh (L) and Alan Chalabi (R) from England take a photograph at Meta (formerly Facebook) corporate headquarters in Menlo Park, California on November 9, 2022.
Josh Edelson | AFP | Getty Images
Meta said it expects revenue in the primary quarter of between $26 billion and $28.5 billion. Analysts were expecting sales of $27.1 billion, in accordance with Refinitv. Sales in the primary quarter of 2021 got here in at $27.9 billion. Should Meta reach the high end of its guidance range, the corporate could end its streak of year-over-year declines.
“Our community continues to grow and I’m pleased with the strong engagement across our apps,” Meta CEO Mark Zuckerberg said in a press release. “Our management theme for 2023 is the ‘Yr of Efficiency’ and we’re focused on becoming a stronger and more nimble organization.”
Meta said that its headcount increased 20% year-over-year to 86,482 as of December 31, 2022. That number features a large chunk of the over 11,000 staff that Meta said it might lay off last November.
The corporate expects that its total expenses in 2023 will probably be within the range of $89 billion to $95 billion, which is lower than its prior outlook of $94 billion to $100 billion for the 12 months. Meta attributed the adjustment to “slower anticipated growth in payroll expenses and value of revenue.”
Meta also said that it’s lowering its capital expenditure estimates for the 12 months to be within the range of $30 billion to $33 billion, down from $34 billion to $37 billion. That is partly as a consequence of the corporate spending less money on data center construction. As a substitute, Meta said it’s shifting to a special kind of information center architecture intended to be more cost efficient while acting because the backbone of its various artificial intelligence projects.
Meta said on Wednesday that it authorized a $40 billion increase to its stock repurchase plan. The corporate bought back $27.9 billion price of its shares last 12 months.
Earlier this week, Snap reported fourth quarter earnings that missed on sales, sending its shares tumbling. While much smaller than Meta, Snap faces among the same challenges, including a slowdown in internet advertising spend, increased competition from TikTok and a weakened targeting promoting system as a consequence of Apple’s 2021 iOS privacy update.
Alphabet and Amazon will wrap up earnings reports from the foremost online ad platforms on Thursday, followed by Pinterest next week.
Meta shares plummeted by over 60% last 12 months, as Zuckerberg struggled to sell Wall Street on his plan to pivot the corporate towards the yet-to-be-developed world of the metaverse. Zuckerberg has said the metaverse, which would come with virtual reality and augmented reality technologies, could represent the following major way people interact.
The massive bet has frustrated investors, who worry the corporate is putting an excessive amount of deal with a futuristic endeavor while its core ad business struggles to revive growth. Meta’s Reality Labs unit, home to the metaverse ambitions, lost $4.28 billion within the fourth quarter, bringing its total operating loss for the 12 months to $13.72 billion.
Meta said last 12 months that “Reality Labs operating losses in 2023 will grow significantly year-over-year.”
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