For years, Facebook and its CEO Mark Zuckerberg have invested heavily in growing the brand, including in areas like virtual reality with unproven potential. After a brutal year in which the company lost more than $600 billion in market value, Zuckerberg has apparently begun to speak the language of Wall Street.
Facebook parent Meta on Wednesday reported its third consecutive quarterly decline in revenue and a sharp drop in profit for the final three months of 2022, as it faced broader economic uncertainty, increased competition in the social media market and incurring in significant costs from a recent round. of layoffs.
Even so, the company exceeded the sales expectations of analysts on the US stock exchange. In addition, it pledged to focus on “efficiency”, lowered its forecast for capital spending over the next year and announced plans to increase its share buyback plan by $40 billion. All of this helped send Meta shares up nearly 20% after Wednesday’s trading session.
“Our management theme for 2023 is the ‘Year of Efficiency’ and we are focused on becoming a stronger, more agile organization”, said Zuckerberg in a statement with the financial results.
Meta posted nearly $32.2 billion in revenue for the quarter, down 4% year-over-year but above the $31.5 billion analysts projected. The social media giant’s quarterly net income was just $4.7 billion, down 55% year-on-year and below analyst expectations.
Meta also announced plans to lay off around 11,000 employees in November. The company currently has a broad hiring freeze and plans to further limit hiring throughout the year, Meta CFO Susan Li said on a conference call with analysts on Wednesday.
In its earnings report, Meta said it lowered its 2023 capital spending guidance slightly to between $30 billion and $33 billion, citing plans to reduce spending on data center construction.
For the first quarter of 2023, Target expects revenue of between $26 and $28.5 billion, the higher end of which would represent an increase from the year-ago quarter and break the company’s streak of consecutive quarterly revenue declines.
This article used as a source the writing by Clare Duffy to the website CNN Business.
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