Despite reporting stronger-than-expected sales and profit figures for the first quarter, Meta’s share price dropped by 15%. Analysts had predicted lower sales and income figures, but Meta surpassed these expectations.
Despite this, Meta’s investors expressed disappointment when the company lowered its sales forecast for the upcoming quarter.
The firm experienced a significant revenue growth of approximately 27%, bringing its total to around $29.0 billion. This substantial increase nearly quadrupled the net income, reaching about $12.37 billion. Sales and marketing expenses resulted in fewer costs, contributing to larger operating margins, which in turn boosted the company’s profit by over 16%.
Meta anticipates a sales increase of approximately 41% from $36.5 billion to $51.78 billion during the second quarter of the year. The company intends to invest between $35 and $40 billion for capital expenditures in 2024, with a significant portion earmarked for AI technology development.
Investors’ worries went beyond the Reality Labs division of the company, which consistently reported losses. In Q1 alone, Reality Labs recorded sales of $440 million but incurred losses of $3.85 billion. Nevertheless, Meta faces some challenges as CEO Mark Zuckerberg continues to champion the Metaverse as the future of communication for the company.
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2024-04-25 04:20