Meta Stock (NASDAQ:META)
After-hours trading in Meta Platforms (NASDAQ:META) is down 11.5% after the firm reported mixed third-quarter results, beating revenue estimates but missing profitability and warning of near-term sales issues.
Its 4% drop in revenue to $27.71B was better than projected. That was better than expected, but rising costs and expenses cut operating income by 46% to $5.66B. As a result, Meta stock dropped in the after-hours trading session.
A year ago, the operating margin was 36%, but its just 20% this year. In addition, because of a far higher effective tax rate, net income dropped by more than half to $4.4B.
CEO Mark Zuckerberg stated in his characteristically brief inaugural earnings announcement, While we have near-term headwinds on sales, the foundations are there for a return to faster revenue growth.
As 2023 draws near, were approaching it with a focus on prioritization and efficiency that will help us negotiate the present situation and emerge an even stronger business, Zuckerberg said.
Facebooks DAUs increased by 3% to 1.98B, which is more than the 1.86B that was predicted. The number of people who use Facebook every month increased by 2% to reach 2.96 billion (just short of expectations for 2.97B).
The number of people using its Family of Apps, which includes Instagram and WhatsApp, increased by 4% to 2.93 billion daily and 3.71 billion monthly.
Ad impressions were up 17%, while the average price dropped 18%.
Meta claims that its workforce as of September 30 was 87,314, a growth of 28% from a year before, which starkly contrasts the industry-wide trend of slowing recruiting and possible layoffs. Meta predicts that the total will be almost the same after the fourth quarter.
Meta expects sales of $30 billion to $32.5 billion for the fourth quarter, below the average estimate of $32.2 billion. Thats if we believe foreign exchange rates are a 7% drag on GDP annually.
It anticipates total expenditures of $85 billion to $87 billion in 2022, down somewhat from an earlier forecast of $85 billion to $88 billion. And it forecasts capital spending of $32B-$33B in 2022, up from $30B-$34B before.
Featured Image- Unsplash @ solomin_d
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