Meta, formerly known as Facebook, faced a significant setback on Wednesday as their shares plummeted more than 15% in extended trading. This came after the company issued a light forecast for the upcoming quarter.
Despite this, Meta reported impressive first-quarter results, with a 27% increase in revenue and more than doubled net income. Sales and marketing costs also dropped by 16% in the quarter.
During the earnings call, CEO Mark Zuckerberg discussed the company’s investments in areas such as glasses and mixed reality. Meta announced that they no longer report daily and monthly active users, instead focusing on a new metric called “family daily active people,” which stood at 3.24 billion for March 2024.
The stock price for Meta has seen a 40% increase this year, raising investor expectations. The company is aiming to become a “stronger and more nimble organization” with minimal hiring and capital expenditures for 2024 estimated to be between $35 billion to $40 billion.
Advertising revenue, which makes up the majority of Meta’s business, jumped by 27%. However, the Reality Labs unit continues to struggle, posting $3.85 billion in losses in the first quarter.
Executives will be discussing the company’s results on a call with analysts at 5 p.m. ET. Despite the disappointing forecast, Meta remains optimistic about their long-term growth and strategic initiatives in new technology ventures.
