Meta shares surge 15% after Facebook parent tops earnings estimates
Key takeaways:
- Meta surged 15% Thursday after the firm reported better-than-expected earnings in the first quarter.
- Facebook’s parent firm said daily active users increased just in the first quarter to 1.96 billion from 1.93 billion.
- But sales grew only 7% from a year back, marking the first time income produced in the single digits.
Shares of Facebook parent firm Meta continued to rally Thursday after the firm reported better-than-expected earnings in the first quarter.
Meta reported profits per share of $2.72, higher than the $2.56 predicted by critics. However, income came in at $27.91 billion, lower than estimates.
Meta’s stock climbed 15% Thursday morning. It’s still down nearly 40% since the beginning of 2022, alongside a raft of other tech shares that fell amid concerns over growing inflation, the Ukraine war, and a return of Covid lockdowns in China.
Anticipations were relatively low going into Meta’s latest quarterly results, a mixed bag.
After the firm shocked investors in February, it posted a disappointing fourth-quarter statement, which showed daily active users dropping for the first time.
Meta on Thursday said its daily active users increased barely in the first quarter, to 1.96 billion from 1.93 billion.
The company, which changed its group name from Facebook the previous year, pays heavily to make CEO Mark Zuckerberg’s idea for the “metaverse” — a hypothetical digital world including work, leisure, and commerce — a reality.
At the same time, the firm is facing increasing competition from the Chinese short-form video platform TikTok.
Meta’s first-quarter sales increased 7% from a year back, marking the first time in its 10-year history that earnings rose in the single digits as a public company.
The firm said it anticipates revenue within $28 billion to $30 billion for the second quarter. It would mark the first-ever decline in quarterly turnover year-on-year if it strikes the middle of that range.