![]() ![]() More than three billion people use at least one of Meta’s products every day, the company said, though its established social networks have continued to grow at a slower rate. This advertisement has not loaded yet, but your article continues below. Net income in the second quarter was US$7.8 billion, or US$2.98 per share, compared with the US$2.92-per-share average analyst estimate. Sales in the current quarter will be as much as US$34.5 billion, also topping average estimates. Meta reported second-quarter revenue rose 11 per cent to US$32 billion, compared with analysts’ average projections for US$31.1 billion. Even plans to increase spending over the next two years, as it invests heavily in strategic areas such as artificial intelligence and virtual reality, didn’t damp investor enthusiasm for the stock. Meta’s revenue could grow as much as 20 per cent in the current quarter, the company said on July 26.Īt the same time, Meta has been cutting thousands of jobs and teams in what chief executive Mark Zuckerberg calls its “year of efficiency,” putting the company on stronger footing with its shareholders. The format has succeeded in increasing usage and is now also helping draw advertisers, reigniting their spending after an industry-wide budget tightening in 2022. Finally, Wall Street is realizing that too.The company is betting on Reels - short-form videos that are similar to those on rival TikTok - to draw more attention to its social networks, Facebook and Instagram. But if the past 18 years are reflective of the future of Facebook, I don’t think anyone expects it to do any of these things. And at the least, the company should try to seem contrite. ![]() It should give people complete control over their privacy. It should rid-or at least truly try to rid-the social network of vitriol and hate. ![]() Facebook should instead fix all of the problems that everyone outside Facebook can see as bright as day. It should own that it screwed up and not try to copy another start-up, or rebrand itself with some futuristic idea, or blame its “headwinds” on its competitors. Ultimately, the company has a reputation issue, not a product issue. It seems to me that there’s only really one way to fix the problems at Facebook. Evil.” And who wants that on their résumé? As one ex-Facebook employee put it: “It’s like working for Dr. (Zuckerberg has a strained relationship with the founders of Instagram or WhatsApp, both of which Facebook purchased, and both of which he forced into directions the company’s creators did not want to go, choosing revenue over user experience.) What’s more, Facebook can no longer hire the brightest minds to go and work there and fix the problems it faces, because few engineers I’ve spoken with in Silicon Valley want to work for the big, bad corporation. And even if there was a slither of an opportunity, Zuckerberg has burned so many bridges with the founders of companies he has acquired, that no logical CEO would step foot in the lion’s den with him. Even if it were possible, could you imagine regulators allowing Meta to buy TikTok or Snap? Not a chance. It’s too big to be able to acquire its way out of the problem. And Microsoft did similarly well this past quarter.Īs a result of these actions, the company has painted itself into a corner. Apple’s revenue popped up by 11% after epic earnings. Alphabet’s revenue rose by 41% after the company blew past its earnings. What’s worse for Facebook is that it appears to be an outlier among its competition in Silicon Valley. “On the impressions side, we expect continued headwinds from both increased competition for people’s time and a shift of engagement within our apps towards video,” Facebook said on the call. While revenues slightly beat expectations, the company warned that the upcoming year was potentially going to be worse for Facebook. And it’s not a disaster that will be rectified by next quarter, or even the one after that. company.Īlthough Wall Street may have panicked Thursday, this wasn’t actually a disaster that happened overnight-or even over the past quarter, when Facebook reported that its earnings came in below expectations, with Daily Active Users (or DAUs) on Facebook down during the fourth quarter for the first time in the company’s history. Now the company and its founder get to add one more record to their résumé: The company’s stock opened down more than 24% on Thursday after a disastrous earnings call, which erased roughly $200 billion from Meta’s market cap, which is, according to Bloomberg, the biggest loss of market value in single day for a U.S. A few years before that, in 2008, its founder, Mark Zuckerberg, then 23, became the world’s youngest self-made billionaire. In 2012, the company became the first social network to reach 1 billion users. Facebook, or Meta, or whatever you want to call it, has broken a lot of records over the years. ![]()
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