Meta✴ revealed its financial results for the third quarter of 2024, reporting weak user growth and warning of a sharp increase in AI infrastructure spending in 2025. The company’s revenue grew 19% to $40.59 billion and net income increased 35% to $15.7 billion, but the number of active users was lower than expected at 3.31 billion.
On Wednesday, after the release of the earnings report, the company’s shares showed a slight decline in after-hours trading. Earnings per share were $6.03, beating analysts’ estimates of $5.25, and revenue reached $40.59 billion, also beating expectations of $40.29 billion. However, the company continues to face difficulties in growing its user base, which causes concern among investors.
For the third quarter, Meta✴ recorded 3.29 billion daily active users, which is 5% higher than last year, but still below the expected 3.31 billion. The company’s net income grew 35%, which is the smallest increase in a year since II quarter of 2023. Meta✴ raised its capital expenditure forecast for 2024: it is now expected to be between $38 and $40 billion, up from the previous $37–40 billion.
CEO Mark Zuckerberg noted that the company intends to continue active investments in AI and technical modernization of infrastructure. As part of this strategy, Meta✴ is investing heavily in new data centers and purchasing Nvidia graphics processing units (GPUs), which play an important role in the performance of AI systems used in the company’s advertising business. Meta✴’s advertising revenue was $39.9 billion, accounting for 98.3% of the company’s Q3 revenue, with year-over-year growth of 18.7%. According to Zuckerberg, more than a million advertisers have already used Meta✴ advertising tools based on generative AI.
Against the backdrop of overall revenue growth of 19% in the third quarter, Meta✴’s revenue in the Asia-Pacific region increased only 15%, which was the lowest of all regions. The company’s chief financial officer, Susan Li, attributed this to a decline in activity from Chinese advertisers, including online stores Temu and Shein, which had an impact on revenue growth rates across the region. In the second quarter, the annual revenue growth rate in this region was 28%. Meta✴ forecasts its fourth-quarter revenue of $45 billion to $48 billion, above analysts’ consensus estimate of $46.3 billion and reflecting the company’s cautious optimism.
Reality Labs, which develops virtual reality (VR) and augmented reality (AR), recorded an operating loss of $4.4 billion in the third quarter, which was lower than expected $4.68 billion. Sales of the division increased by 29%, reaching $270 million, although analysts’ expectations were $310.4 million. Since its founding in 2020, Reality Labs has accumulated operating losses of more than $58 billion, which once again emphasizes the high cost of developments in the field of VR and AR.
The total number of Meta✴ employees reached 72,404 people as of September 30, an increase of 9% compared to the same period last year. The company’s staff growth reflects its strategy to strengthen its position in the field of AI and infrastructure development.
Huawei expects the number of applications for its HarmonyOS software platform to reach 100,000 in…
A decade after third-generation Samsung heir Lee Jae-yong took the helm of the South Korean…
Exactly 20 years ago, on November 23, 2004, World of Warcraft was released, quickly becoming…
Xiaomi brings to the attention of users its new smartphones Xiaomi 14T Pro, Xiaomi 14T…
A fresh report from iSeeCars analysts showed that among automobile brands, Tesla electric vehicles have…
Tronsmart offers users a range of Bluetooth speakers, including Halo 200, Mirtune S100 and Bang…