Facebook Posts Increased Better-than-Expected Quarterly Earnings 2022-04-27 14:35:02

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Mark Zuckerberg told the world last October that he was rebranding Facebook to Meta as the company pushes into the metaverse.

Facebook | via Reuters

Parent share on Facebook dead Jumped 15% in extended trading on Wednesday after the company Earnings mentioned That beat estimates even while revenue was disappointing.

Here are the results.

  • Earnings per share: Expectations are $2.72 versus $2.56, according to a Refinitiv poll of analysts
  • Revenues: $27.91 billion versus the $28.2 billion forecast, according to Refinitiv
  • Daily Active Users (DAUs): 1.96 billion versus 1.95 billion expected, according to StreetAccount
  • Monthly Active Users (MAUs): 2.94 billion versus 2.97 billion expected, according to StreetAccount
  • Average Revenue Per User (ARPU): $9.54 vs. $9.50 expected, according to StreetAccount

Meta investors updated for the first time since Brutal fourth-quarter earnings report in February The stock is down 26%, its worst day ever. Daily active users, which fell in the fourth quarter for the first time, rebounded slightly from 1.93 billion to 1.96 billion.

Wednesday’s after-hours rally still leaves the stock lower for the year. As of closing, shares have lost nearly half of their value in 2022.

In addition to its earnings number, Facebook also beat expectations for average revenue per user. But almost every other key metric was missing, including monthly active users.

Revenue rose 7% in the quarter, the first time in Facebook’s 10-year history as a public company that growth has hit single digits. Analysts had expected growth of 7.8%.

For the second quarter, Facebook expected revenue of between $28 billion and $30 billion, topping the $30.6 billion estimate of analysts polled by Refinitiv. The company said in the statement that the guidance reflects ongoing trends since the first quarter, including weak revenue growth that “coincided with the war in Ukraine.”

Facebook changed her name To Meta in October, reflecting the CEO Mark Zuckerberg An effort to propel the company toward a future that includes work, play and study in a virtual world.

Facebook’s suite of apps, including the core app, Instagram and WhatsApp, accounted for 97.5% of revenue in the quarter. The remaining $695 million came from Reality Labs, which is part of the company trying to build products for the metaverse.

In the app group, net income fell 13% from a year earlier to $11.48 billion. Reality Labs lost $2.96 billion in the period compared to a loss of $1.83 billion in the first quarter of 2021.

Facebook has cut its overall expenditure guidance for 2022 to between $87 billion and $92 billion, down from its previous estimate of $90 billion to $95 billion. It expects most of this expense growth to be driven by its suite of apps, followed by Reality Labs.

Other social media companies have similarly cited macroeconomic factors affecting their advertising revenue. Snap CEO Evan Spiegel call The first quarter is “more difficult than we expected”. The company said some advertisers paused ad campaigns after the Russian invasion of Ukraine in February. YouTube owned by Google It only grew 14% in the first quarterwell below analysts’ expectations of 25%.

Digital advertising can also be affected by inflation and Apple’s recent privacy changes to iPhone operating systems, which Meta CFO Dave Wehner previously predicted would lead to Hitting $10 billion in revenue in 2022, though he admitted that this number was an estimate.

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