Meta sees profits more than double, warns of uncertain 2024

This article was last updated on October 26, 2023

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Record Quarter for Meta

Meta, formerly known as Facebook, has reported a record-breaking quarter with profits exceeding 11.58 billion dollars (around 11 billion euros). This represents a doubling of profits compared to the previous year, showcasing the strength of the company’s advertising-based revenue model. Despite facing challenges in 2022 due to rising inflation and economic uncertainty, Meta’s financial performance has rebounded to achieve its highest turnover and profit figures to date.

Major Layoffs

Last year, Meta underwent a significant reorganization, resulting in the largest layoffs the company has seen in years. More than 21,000 employees were let go since November 2022, leading to a decrease in Meta’s workforce from a peak of 86,000 employees. This restructuring was necessary to navigate the challenging economic landscape at the time.

Uncertain Forecast for 2024

While Meta’s current financial figures are impressive, the company has expressed caution regarding the future. The volatile economic situation has created uncertainty around Meta’s revenue projections for 2024. This cautionary statement led to a decline in Meta’s stock price after regular trading hours.

In addition to economic uncertainties, Meta’s future investments also contribute to the uncertain forecast. The company plans to invest billions in various projects, including network infrastructure such as data centers. Meta is also continuing to allocate significant funds to Reality Labs, its department dedicated to developing the metaverse. While these investments show Meta’s commitment to innovation, Reality Labs has incurred heavy losses, totaling 10.3 billion euros for this year alone.

Threads: Meta’s Twitter Alternative

Meta CEO Mark Zuckerberg also provided an update on Threads, the app launched earlier this year as an alternative to Twitter. With Elon Musk’s recent acquisition of Twitter, there has been increased interest in alternative platforms.

Zuckerberg revealed that Threads currently has nearly 100 million monthly active users. While this figure pales in comparison to the user base of Instagram or Facebook, Zuckerberg believes that Threads has the potential to reach a billion users in the coming years.

Google’s Strong Performance

Alongside Meta, Google’s parent company Alphabet also released its financial results. While Alphabet experienced significant growth in turnover and profit, Meta’s growth outpaced that of Google. However, both companies demonstrated the resilience of the tech sector amidst challenging economic conditions.