Facebook (now known as Meta) reported a second straight quarterly revenue decline, with its stock plummeting an astonishing 22 percent in morning trading after already losing two-thirds of its value this year so far.
CNBC reports that Facebook shares have continued their downward trend throughout 2022, plunging by more than 22 percent in morning trading on Thursday following a weak forecast for the fourth quarter that came with third quarter earnings well below Wall Street’s expected earnings. CNBC posted the following figures from the report:
- Earnings per share (EPS): $1.64 vs $1.89 expected, according to Refinitiv
- Revenue: $27.71 billion vs. $27.38 billion expected, according to Refinitiv
- Daily Active Users (DAUs): 1.98 billion vs 1.98 billion expected, according to StreetAccount
- Monthly Active Users (MAUs): 2.96 billion vs 2.94 billion expected, according to StreetAccount
- Average Revenue per User (ARPU): $9.41 vs. $9.83 expected, according to StreetAccount
Facebook is facing a number of issues currently, such as a slowdown in online ad spending, negative effects of Apple’s iOS 14 App Tracking Transparency feature, and increased competition from other platforms such as the Chinese-owned video app TikTok. This has resulted in the company posting consecutive quarters of revenue declines, with a third straight drop expected in the fourth quarter.
While company revenue fell by four percent in the third quarter, Facebook’s costs and expenses rose by 19 percent year over year to $22.1 billion. Operating income declined 46 percent from the year previous to $5.66 billion.
Facebook’s operating margin sank to 20 percent from 36 percent a year earlier. Overall net income was down by 52 percent to $4.4 billion in the third quarter. The company’s VR division, Reality Labs, has lost $9.4 billion in 2022 alone.
“We do anticipate that Reality Labs operating losses in 2023 will grow significantly year-over-year,” Facebook said. “Beyond 2023, we expect to pace Reality Labs investments such that we can achieve our goal of growing overall company operating income in the long run.”
The company added that it is “holding some teams flat in terms of headcount, shrinking others and investing headcount growth only in our highest priorities.”
“As a result, we expect headcount at the end of 2023 will be approximately in-line with third quarter 2022 levels,” the company said.
Read more at CNBC here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship. Follow him on Twitter @LucasNolan