Meta Delivers Strong Q2 Performance, but Challenges Remain
Meta is doing great. The parent company of Facebook and Instagram delivered an impressive performance in the second quarter (Q2) of 2024, surpassing market expectations and sending its stock higher. The company reported revenue of $39.07 billion, marking a 22% year-over-year increase and exceeding analysts’ forecasts of $38.31 billion. This represents the fourth consecutive quarter of growth. Net income soared 73% to $13.47 billion, or $5.16 per share, outperforming the expected $4.73.
People using Facebook, Instagram, WhatsApp, and Messenger everyday reached 3.27 billion in June, up 7% from the previous year. A key driver of Meta’s profitability was its advertising business. Ad revenue surged 22% year-over-year to $32 billion.
“We had a strong quarter, and Meta AI is on track to be the most used AI assistant in the world by the end of the year,” Meta co-founder, CEO and chairman Mark Zuckerberg said in announcing the earnings. He added, “We’ve released the first frontier-level open source AI model, we continue to see good traction with our Ray-Ban Meta AI glasses, and we’re driving good growth across our apps.”
But not everything is music to Zuckerberg’s ears. Despite this success, Meta’s Reality Labs segment, which encompasses the Quest AR/VR headset and metaverse initiatives, continued to post significant losses. Reality Labs recorded quarterly sales of $353 million, up 28% from the previous year, but faced an operating loss of $4.49 billion, compared to $3.74 billion a year earlier. This segment has now accumulated losses totaling $59.5 billion since 2019.
Looking ahead, Meta expects third-quarter 2024 revenue to fall between $38.5 billion and $41 billion, aligning with analyst predictions. The company is investing heavily in artificial intelligence, with its 2024 capital expenditure forecast now set at $37 billion to $40 billion, up from the previous estimate of $35 billion to $40 billion. Meta anticipates that capital expenditures will continue to grow significantly next year as it invests in AI research and development.
While Meta’s core advertising business thrives, its investments in AR/VR and AI represent high-stakes gambles that could shape its future trajectory.
Source: Variety
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Meta is doing great. The parent company of Facebook and Instagram delivered an impressive performance in the second quarter (Q2) of 2024, surpassing market expectations and sending its stock higher. The company reported revenue of $39.07 billion, marking a 22% year-over-year increase and exceeding analysts’ forecasts of $38.31 billion. This represents the fourth consecutive quarter of growth. Net income soared 73% to $13.47 billion, or $5.16 per share, outperforming the expected $4.73.
People using Facebook, Instagram, WhatsApp, and Messenger everyday reached 3.27 billion in June, up 7% from the previous year. A key driver of Meta’s profitability was its advertising business. Ad revenue surged 22% year-over-year to $32 billion.
“We had a strong quarter, and Meta AI is on track to be the most used AI assistant in the world by the end of the year,” Meta co-founder, CEO and chairman Mark Zuckerberg said in announcing the earnings. He added, “We’ve released the first frontier-level open source AI model, we continue to see good traction with our Ray-Ban Meta AI glasses, and we’re driving good growth across our apps.”
But not everything is music to Zuckerberg’s ears. Despite this success, Meta’s Reality Labs segment, which encompasses the Quest AR/VR headset and metaverse initiatives, continued to post significant losses. Reality Labs recorded quarterly sales of $353 million, up 28% from the previous year, but faced an operating loss of $4.49 billion, compared to $3.74 billion a year earlier. This segment has now accumulated losses totaling $59.5 billion since 2019.
Looking ahead, Meta expects third-quarter 2024 revenue to fall between $38.5 billion and $41 billion, aligning with analyst predictions. The company is investing heavily in artificial intelligence, with its 2024 capital expenditure forecast now set at $37 billion to $40 billion, up from the previous estimate of $35 billion to $40 billion. Meta anticipates that capital expenditures will continue to grow significantly next year as it invests in AI research and development.
While Meta’s core advertising business thrives, its investments in AR/VR and AI represent high-stakes gambles that could shape its future trajectory.
Source: Variety
Share:
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