Posted Oct 26, 2022, 10:33 PMUpdated on Oct 26, 2022 at 11:04 PM
The jolts in the advertising market hit Meta hard. Facebook’s parent company released catastrophic results on Wednesday. Its revenues fell 4% in the last quarter, compared to the same period last year. And its operating profit has almost halved (-46%). It stood at 5.7 billion dollars, instead of 10.4 billion between July and September last year.
Its stock lost more than 11% in trading after the financial markets closed. The drop in operating profit is also linked to a slippage in expenses. Its costs amount to 22.05 billion dollars in three months, an amount 19% higher than those recorded in the same period last year.
“We are in the process of making significant changes to make our operations more efficient,” promises Meta in a press release, in an attempt to reassure the markets. “We are keeping some teams at constant numbers, we are reducing others and we are only investing in teams that correspond to our essential priorities. »
The group expects its number of employees to remain roughly constant by the end of the year. At the end of September, 87,314 people worked for Meta. This figure increased by 28% compared to the same period last year. For several months, Mark Zuckerberg has ensured that the group will reduce sail . He would consider parting with 10% of his workforce, according to the “Wall Street Journal”.
Snap, the parent company of the Snapchat application, has also published alarming financial results last week, with weak revenue growth and an operating loss of $450 million. The action collapsed by 30% on the stock market.
Little interest in the metaverse
This is all the more worrying for Meta as the quarters follow and look alike. The first warning shot came in February, when Facebook announced that it had lost users for the first time in its history. Its stock lost 30% overnight. At the end of July, the company headed by Mark Zuckerberg saw his income is declining which was also a first.
“Long term, Meta has three big problems to overcome,” commented Debra Aho Williamson. “It’s no longer a leader in innovation, its market power is diminishing, and the promise of the metaverse, which is central to Mark Zuckerberg’s vision for the future of his company, is suffering from a combination of consumer apathy, corporate skepticism, and the realities of a broken global economy.”
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Meta shares stall on the stock market after profits halved
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