The Facebook and Instagram owner beat analysts’ expectations on both revenue and profit. The share is still falling after somewhat disappointing guidance.
Less than 30 minutes ago
Updated just now
The case is updated.
It was expected that Meta would continue to deliver strong revenue growth in the first quarter, and almost double the profit from the same time last year. That after the strong results for the end of 2023.
The technology giant beat expectations on both the top and bottom lines.
- The revenue of Meta landed at $36.46 billion in the first quarter. In advance, analysts had $36.12 billion, according to estimates obtained by Bloomberg.
- Earnings per share came in at $4.71, against the expectation of $4.30.
- In total, the result after tax was 12.37 billion dollars. That is more than doubling from the same time last year.
The Meta share nevertheless falls by more than 11 percent in after-market trading.
Read on E24+
Investtech analysis: Buy these three stocks
Meta announces that they expect revenues of 36.5–39 billion in the second quarter. The analysts’ estimate of the guidance was USD 38.24 billion, and several media outlets therefore highlight this as disappointing.
Almost all of Meta’s revenue comes from advertising linked to the company’s apps. That includes Facebook and Instagram, as well as other apps like WhatsApp and Threads. The technology giant has over 2 billion daily active users.
Betting on AI
Updates on the investment in AI are something that is closely followed when it comes to Meta.
At the previous figure release, Meta CEO Mark Zuckerburg linked improvements in the advertising section to AI development, and emphasized AI in the updates on future investment plans.
– It has been a good start to the year, says Zuckerberg this time.
– A new version of Meta AI with Llama 3 is a new step on the way to building the world’s leading AI. We are seeing healthy growth across our apps and continue to make steady progress in building the metaverse.
Meta has jacked up its forecasts for investments in 2024 to 35-40 billion dollars, from 30-37 billion previously.
The company explains that it “continues to step up infrastructure investments to support our AI roadmap”. Meta writes that investments are expected to continue to increase in the coming years to focus on AI research and product development.
Reality Labs, Meta’s venture into the metaverse, continues to lose big sums. In the first quarter, the operating profit for this business was minus 3.85 billion dollars. It is a smaller loss than expected.
Long stock rally
When Meta last presented results in February, after last year’s fourth quarter, expectations were beaten both in terms of turnover and profit. The company also announced that it would pay a dividend for the first time, and buy back shares for $50 billion.
The share made a jump afterwards, and it has risen somewhat further afterwards. It has mostly gone up for the Meta share over the past year and a half.
Since the new year alone, the stock is up 39 percent.
Ahead of today’s figures release, the Meta share fell slightly.
