Meta✴ published a report showing that its financial performance for the second quarter of 2024 exceeded analysts’ estimates. The company’s revenue, income, and forecast for the coming quarter were higher than expected.
Image source: Mark Zuckerberg
Meta revenue✴ in the second quarter of 2024 amounted to $39.07 billion against analysts’ expectations of $38.31 billion, which corresponds to growth of 22% year-on-year – for the fourth quarter in a row the company has demonstrated revenue growth of more than 20%. The company’s profit amounted to $13.47 billion or $5.16 per share, while analysts predicted $4.73 per share – this corresponds to growth of 73%: in the second quarter of last year, Meta’s profit✴ was $7.79 billion, or $2.98 per share. According to the company’s own forecast, revenue in the third quarter will be in the range of $38.5 billion to $41 billion (an average of $39.75) – analysts expected a forecast of around $39.1 billion.
Positive Meta Results✴ indicate that it continues to grow its share of the digital advertising market, which is the company’s core business. Advertising revenue, which comes primarily from Facebook’s platforms,✴ and Instagram✴showed annual growth of 22%. Last week, Alphabet reported an 11% increase in Google advertising sales, while YouTube did not meet analysts’ expectations.
Meta Costs✴ in the second quarter amounted to $24.2 billion – this also included the settlement of a Texas case on the unauthorized use of data by a facial recognition algorithm, which cost the company $1.4 billion. Capital expenditures for the second quarter amounted to $8.47 billion, which is lower than the $9.51 billion expected by analysts. Meta✴ left its 2024 cost guidance at $96 billion to $99 billion; its $35 billion capital expenditure guidance was raised to a range of $37 billion to $40 billion. The number of Daily Active People (DAP), or users who have opened at least one of the company’s apps, reached 3.27 billion, in line with analyst estimates.
Image source: Meta✴
The social media giant continues to implement the cost-cutting program it announced in late 2022, eliminating a total of about 21,000 jobs in several rounds of layoffs. Operating income increased 58% year-on-year to $14.9 billion; operating margin increased to 38% from 29% over the same period. Headcount decreased 1% year-on-year to 70,799 as of June 30.
At the same time, Meta✴ continues to invest heavily in advanced technologies such as artificial intelligence and virtual reality, which are essential to building the metaverse. The company is investing in data centers and computing resources to compete with competitors. Capital expenditures are expected to increase significantly in 2025 due to investments in supporting research and product development.
By the end of the year, Meta will have✴according to its CEO Mark Zuckerberg, will have 350,000 advanced Nvidia H100 AI accelerators, or 600,000 if you count equipment from other models and manufacturers by analogy. The company recently introduced a major update to its large language models, Llama 3.1 – the most powerful has 405 billion parameters. Since the beginning of the year, Meta shares✴ showed growth of 34%; after the publication of the report, they added an additional 6.9%.
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