Original link: https://www.williamlong.info/archives/6973.html
Meta’s lower-than-expected results once again spooked the market. On October 27, when the US stock market opened, the stock price of Meta (Nasdaq: META), the parent company of Facebook (Facebook), plunged, and the decline once expanded to 24%. One hundred million U.S. dollars. As of press time, Meta’s decline narrowed to 22.36%, at $100.79.
Previously, on October 26, Meta released its financial report for the third quarter of 2022. During the reporting period, the company’s revenue fell by 4% to $27.714 billion. This is the second consecutive quarter of year-on-year revenue decline. The previous second quarter was Meta Revenue fell for the first time in history.
Meta’s third-quarter net profit was $4.394 billion, a sharp drop of 52% year-on-year, and four consecutive quarters of decline; earnings per share (EPS) was $1.64, a year-on-year decrease of 49%, lower than analysts’ expectations of $1.98. According to the Wall Street Journal, Meta has never experienced a fourth consecutive quarterly decline in net profit in nearly a decade.
Meanwhile, Meta issued a lower-than-expected fourth-quarter guidance. Meta expects total revenue of $30 billion to $32.5 billion, while analysts expect $32.2 billion. Meta also expects total spending in 2022 to be between $85 billion and $87 billion, down from an earlier forecast of $85 billion to $88 billion.
Meta founder and CEO Mark Zuckerberg has reiterated his commitment to spending billions of dollars developing the Metaverse.
The financial report shows that Meta’s Metaverse business unit has lost a total of $9.4 billion this year, and has lost more than $10 billion in 2021.
“Obviously, the Metaverse is what we’ve been working on for the long term,” Zuckerberg said on the conference call, adding that long-term investments in the Metaverse business “will ultimately pay off.”
Zuckerberg said Meta faces many challenges, such as economic headwinds, Apple’s privacy policy and competition from software such as TikTok. “Meta will address these issues at various times in the future. Those who are patient and invest in us will eventually pay off,” he said.
However, just this week, Altimeter Capital, one of Meta’s long-term shareholders, expressed dissatisfaction with the money-burning Metaverse. Its CEO Brad Gerstner wrote to Zuckerberg publicly, hoping that Meta would limit its investment in reality labs, preferably no more than 50 One hundred million U.S. dollars. Meta has previously announced that it plans to invest about $10 billion in research and development of metaverse-related technologies this year.
According to a report by CNBC on October 27, local time, Morgan Stanley lowered the rating of Meta on the same day, and analyst Brian Nowak lowered the target price from $205 to $105. He expects Meta to continue to face rising spending as it continues to burn cash on AI.
Source: The Paper
This article is reprinted from: https://www.williamlong.info/archives/6973.html
This site is for inclusion only, and the copyright belongs to the original author.