![]() “To return to stronger growth, Meta needs to turn its business around,” said Insider Intelligence analyst Debra Aho Williamson. The company had about 87,000 employees as of Sept. Meta said it expects staffing levels to stay roughly the same as in the current quarter - a departure from previous years’ double-digit workforce growth. “We’re approaching 2023 with a focus on prioritization and efficiency that will help us navigate the current environment and emerge an even stronger company.” “While we face near-term challenges on revenue, the fundamentals are there for a return to stronger revenue growth,” Zuckerberg said in a statement. ![]() Watch: Meta's earnings reflect one of the best turnaround of all time.In addition to an accelerating revenue decline, Meta also forecast weaker-than-expected sales for the current quarter, further raising worries that the revenue slump is more of a trend than an aberration. "Multi-year AI driven platform retention could help multiple expansion, as terminal value uncertainty has weighed on valuation." "From a business perspective Meta outlined opportunities for AI enabled ad content creation and automated customer service using Meta's messaging platforms," wrote the analysts, who have a buy rating on the stock. Zuckerberg repeatedly emphasized his company's investments in generative AI, which has been popularized by the text-generating ChatGPT tool developed by Microsoft -backed OpenAI.īank of America analysts said in a report that the buildout of an AI ecosystem could bolster Meta's stock multiple. The Reality Labs division, responsible for developing software and hardware for the metaverse, lost $3.99 billion in the first quarter after losing $13.72 billion in 2022.īut there's enthusiasm brewing for another growth market: artificial intelligence. "Meta successfully 'passed the baton' from cost cuts to revenue re-acceleration," the analysts wrote.Īs for Meta's pivot to the nascent virtual world of the metaverse, the project continues to bleed cash. They noted that "user growth remains strong" and said the business can keep expanding even with lower headcount. Piper Sandler analysts, who also have a buy rating on the stock, said Meta is in a favorable revenue position for the rest of the year. "With better monetization, additional room for cost efficiency, and increased scrutiny of TikTok, we continue to like the setup for FY23," wrote the analysts, who recommend buying the stock. lawmakers, with many of them trying to ban the app.Īnalysts at Mizuho Securities pointed to improved ad pricing as a significant catalyst for Meta, driven by Reels and messaging. Meta is figuring out how to better generate revenue from Reels and, at the same time, could be benefiting as TikTok, which is owned by the Chinese company ByteDance, faces heavy scrutiny from U.S. Reels currently monetizes at a slower pace than older and more established products like the news feed and Stories. The company continues pushing its TikTok-like Reels short-form video service, and finance chief Susan Li told analysts on Wednesday's earnings call that the offering is "on track to becoming neutral to revenue by end of year, early next year." Now, Wall Street's betting that Meta can slowly start to revive growth, with comparisons becoming easier after a weak year in 2022 and newer products beginning to show better traction. They lost two-thirds of their value last year, as the company reckoned with by far its toughest stretch since its IPO a decade earlier. In February, CEO Mark Zuckerberg said this would be the company's "year of efficiency," a declaration that sent the stock up over 20%.Įven with the hot start to the year, Meta shares are still about 37% below their record high from September 2021. However, following a 15% rally on Thursday to over $241, Meta's shares are up 170% since bottoming at under $89 in November.įor the most part, investors have been jumping on Meta's cost-cutting story and two rounds of job reductions, which began in November and are continuing in the first half 2023. Personal Loans for 670 Credit Score or Lower Personal Loans for 580 Credit Score or Lower Best Debt Consolidation Loans for Bad Credit ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |