Meta witnesses strong rise in ad revenue
By Felicia Nwosu
Mark Zuckerberg, Meta’s Chief Executive, has disclosed that the company’s second-quarter revenue grew from 11% to $32 billion in the quarter ended June 30, compared with analysts’ average estimate of $31.12 billion. Reuters said this was according to data from Refinitiv.
The Meta boss affirmed that Ad revenue rose 12% in the quarter, faster than growth at Google, where ad revenue rose 3%, while adjusted earnings per share of $2.98 topped Wall Street targets of $2.91. He maintained that such spending comes after aggressive cost-cutting in other parts of the company, including safety teams and basic business functions, adding that, such also applies where Meta shares were up 7.5% in after-hours trade.
“We continue to see strong engagement across our apps and we have the most exciting roadmap I’ve seen in a while with Llama 2, Threads, Reels, new AI products in the pipeline, and the launch of Quest 3 this fall,” he said.
He stated that its financial statement witnessed a robust and buoyant outlook with a strong rise in advertising revenue. The social platform disclosed that the result was not in consonance with the projections made earlier by Wall Street financial targets for the second quarter, where its third-quarter revenue forecast was above market expectations.
He further mentioned that the emergence of the impressive financial performance came a day after a strong performance from Alphabet’s Google. It noted that the surge is an indication that consumers, and the advertisers are spending despite broad economic concerns.
Interestingly, the global social network also forecast that expenses would rise in both 2023 and 2024, citing costs including legal fees and increased spending on infrastructure considered key to the tech sector’s feverish AI race.
Refinitiv’s data also showed that the social media giant has been climbing back from a bruising 2022, buoyed by hype around emerging AI technology and an austerity drive in which it has shed around 21,000 employees since last fall. It explained also that Meta’s shares have more than doubled in value this year as a result, the revenue forecast did not specify whether the figure includes any sales that might come from the recently launched Threads app, which does not yet have ads.
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