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Shares of Meta Skyrocketed, Do You Want to Know Why?

by Carl Steward
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Facebook and resultsShares of Meta Skyrocketed, Do You Want to Know Why?

Shares of Meta Platforms Inc jumped 18% in extended trading on Wednesday, after Facebook’s parent company reported earnings that surpassed expectations even as revenue was disappointing.  

The tech giant updated investors for the first time since a brutal fourth-quarter earnings report in February sent the stock down 26%, its worst day ever. The number of daily active users declined in the fourth quarter for the first time. Hopefully, the number of daily active users rose in the first quarter from 1.93 billion to 1.96 billion. 

We should mention that the after-hour rally on Wednesday still leaves the stock way down for the year. As of the close, the shares of Meta lost almost half of their value this year. However, if the stock continues its journey to the top on Thursday and ends the trading day up more than 19.1%, it would be its second-best day ever and its biggest gain since July 2013. 

Meta and expectations 

Apart from the earnings figure, Facebook also surpassed expectations for average revenue per user. Nevertheless, almost every other key metric was a miss, including monthly active users.

Facebook’s parent company’s revenue rose 7% in the quarter, its worst result in a long time

For the second quarter, Meta forecast revenue of $28 billion to $30 billion, trailing the $30.6 billion estimate of analysts surveyed by Refinitiv. 

Meta said in the release that the guidance takes into consideration continued trends in the first quarter, including soft revenue growth that “coincided with the war in Ukraine”.

The company’s family of apps, including the core app, Instagram and WhatsApp, accounted for 97.5% of revenue in the quarter. The rest came from Reality Labs, the part of Meta that is attempting to build products for the metaverse.

The tech giant lowered its total expenses guidance for 2022 to somewhere between $87 billion and $92 billion. Meta expects most of that expense growth to be driven by its family of apps segment, followed by Reality Labs. 

The post Shares of Meta Skyrocketed, Do You Want to Know Why? appeared first on forexinsider24.com.

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