Meta’s Facebook Reports 3.03 Billion Monthly Active users in Q2 2023, with a Strong increase in Advertising Revenue.

Meta’s Facebook

Facebook parent Meta exceeded market estimates for quarterly results on Wednesday, thanks to a recovering digital ad sector.

During the most recent quarter, Meta declared a profit of $7.8 billion (approximately Rs. 63,949 crores) on revenue of $32 billion (about Rs. 2,62,358 crore), as the number of people using Facebook monthly increased to 3.03 billion.

“We had a good quarter,” Meta CEO Mark Zuckerberg remarked during an earnings call.
“We’re still seeing strong engagement across our apps, and we’ve got the most exciting roadmap I’ve seen in a long time…”

Meta had a difficult 2022 due to a deteriorating economic climate, which prompted advertisers to cut back on spending, and Apple’s data privacy improvements, which allowed users to restrict ad targeting, the cornerstone of Meta’s company.

However, like the other major US technology businesses, Meta’s share price soared in 2023, which Zuckerberg predicted in January would be the “year of efficiency.”

“With two straight quarters of positive revenue growth and the first quarter of double-digit revenue growth since late 2021, Meta’s year of efficiency is off to a strong start,” according to Insider Intelligence analyst Debra Aho Williamson.

“There’s a lot to be happy about right now in Meta,” Williamson remarked.

In after-market dealings, Meta shares were up more than 7% to $320.32 (approximately Rs. 26,262).

According to the company’s earnings report, the number of adverts on its various applications increased by 34% year on year in the second quarter.

Analysts highlighted an increase in advertiser interest in Reels, the Tik Tok-inspired video format, as well as a less bleak economic environment favorable to marketing investment.

Meta is making “good progress” in generating revenue from Reels, with the video clips being viewed more than 200 billion times per day across Facebook and Instagram, according to Zuckerberg.

Meta’s pledge to slash costs led to an unprecedented bout of cost-cutting, with the corporation laying off tens of thousands of employees since last November.

Meta reported 71,469 employees at the end of June, a 14% decline from the same time last year.

The firm has encountered criticism for its bet on the metaverse, a virtual reality environment that Meta hopes will be the next frontier online, which led to the company changing its name from Facebook in 2021.

Customers have so far been unimpressed with the technology, despite the fact that Apple will enter the space sometime next year with the debut of its pricey Vision Pro headset.

The slow rate at which people are adopting the metaverse was described by Zuckerberg as a “somewhat sobering signal,” but he remained optimistic that it is a computing platform of the future.

According to Zuckerberg, the metaverse and Artificial intelligence are still top priorities at Meta.

Meta stated in its quarterly report that it anticipates its operating losses at the VR unit to “increase meaningfully” in the coming year.

The corporation has also jumped to capitalise on the confusion at Twitter, which has now been rebranded X.

Earlier this month, Meta hastened the release of Threads, a text-only app that received over 100 million downloads in just a few days, yet the service’s long-term viability remains unknown.

“We saw unprecedented growth right out of the gate, and, more importantly, we’re seeing more people coming back daily than I’d expected,” Zuckerberg said of Threads.

“Now we’re focusing on retention and improving the fundamentals; I’m really happy with where we’re going.”

In terms of artificial intelligence, Zuckerberg has taken a different path from Microsoft and its relationship with Open AI.

Instead, Meta has taken a more “open source” approach, making its Llama generative AI technology available for researchers and businesses to customise to their own needs.

Investors are interested in seeing how Meta develops its usage of generative AI in its products, as seen by questions on the results call.

In a recent podcast, Zuckerberg stated that his company is developing an AI platform that will allow creators and advertisers to collaborate more effectively.

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