Meta (Facebook) quarterly revenue declines for the first time
The giant’s net income fell 36% to $6.7 billion, largely due to competition from other platforms like TikTok.
Meta (Facebook, Instagram) posted second-quarter revenue that fell 1% year over year to $28.8 billion, a first in the social media giant’s history.
Net income fell 36% to $6.7 billion, with the California group suffering from competition from other platforms like TikTok and budget cuts from advertisers due to the poor economy. For the current quarter, Meta expects revenue of between $26 billion and $28.5 billion. A prognosis showing that the group “has a mountain the size of Everest to climb‘ responded analyst Dan Ives of Wedbush Securities.
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On Wall Street, the company’s stock fell more than 4% in electronic trading after the close. On the audience side, Facebook has about 1.97 billion daily active users, up 8 million from last quarter, and 2.934 billion monthly active users, down 2 million from late March. In total, as of June 30, 3.65 billion people worldwide use at least one of the group’s four networks and messengers – Facebook, Instagram, WhatsApp and Messenger – every month.
Meta has been watched by the market like milk on fire since earlier this year, when the group first announced it had lost users on its original social network, Facebook.
“Never been so concerned»
About a million active daily users left the platform in the last three months of 2021 (1.929 billion at the end of December). Since the beginning of February, the stock price has halved and more than $400 billion in market cap has gone up in smoke. “I’ve been covering Meta for years and have never been so concerned about the future of the companynoted Debra Williamson, an analyst at Insider Intelligence.
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The second-largest digital advertiser in the world derives its strength from its ability to accurately target hundreds of millions of users in an environment where they spend time every day, connecting or having fun. “But Meta is losing control of its massive fan base‘ noted the expert. “The US Facebook user base is barely growing, and while Instagram is helping move the boat forward, we’re starting to see a slowdown among teens and young adults.‘ she elaborated.
The photo and video app was the subject of controversy this week, with celebrities Kim Kardashian and Kylie Jenner calling out on the network: “Will Instagram again” and to “Stop trying to be TikTok“. The post was picked up by many users, who were annoyed that the platform mimics the hugely popular TikTok. Meta, like Google on YouTube, has in fact copied TikTok’s format of short and engaging videos published by creators and presented to users thanks to a very powerful algorithm are recommended.
Big platforms are also suffering from economic conditions that are forcing advertisers to slash marketing budgets and Apple’s privacy changes that have limited their ability to personalize ads.