Facebook earnings cut in half, Meta stock heads toward lowest prices in more than 6 years

Facebook parent Meta Platforms Inc. on Wednesday became the latest tech titan tattooed by a precipitous drop in digital advertising, reporting less than half the profit it had in the same quarter a year ago and sending its stock toward the lowest prices in more than six years.

Meta 
META,
-5.59%
 posted third-quarter earnings of $4.39 billion, or $1.64 a share, down from $9.2 billion, or $3.22 a share last year. Total sales, most of which come from ads, were $27.17 billion, down from $29 billion a year ago. Both results missed the average forecast for profit of $1.90 a share and sales of $27.44 billion, according to analysts polled by FactSet.

Meta executives issued a fourth-quarter revenue forecast of $30 billion to $32.5 billion, while analysts were forecasting $32.3 billion.

Daily active users, at 1.98 billion, were in line with analysts’ projections of 1.98 billion for the quarter.

“While we face near-term challenges on revenue, the fundamentals are there for a return to stronger revenue growth,” Meta Chief Executive Mark Zuckerberg said in a statement announcing the results. “We’re approaching 2023 with a focus on prioritization and efficiency that will help us navigate the current environment
and emerge an even stronger company.”

In prepared comments, Meta’s departing chief financial officer David Wehner said it is “making significant changes across the board to operate more efficiently. We are holding some teams flat in terms of headcount, shrinking others and investing headcount growth only in our highest priorities. As a result, we expect headcount at the end of 2023 will be approximately in-line with third quarter 2022 levels.”

Shares in Meta declined more than 13% in after-hours trading, which would put it at levels the stock has not seen since 2016 if the decline were to last into a regular trading session. Meta’s stock has been among the worst in tech this year, crashing and burning 61% so far, while the broader S&P 500 index 
SPX,
-0.74%
has…

..

Read More

Recommended For You

Leave a Reply

Your email address will not be published. Required fields are marked *