In an impressive fourth quarter, Meta reported staggering profit growth, exceeding 200% year-over-year to reach $14 billion, surpassing market expectations. Quarterly sales also witnessed a 25% increase from the previous year, exceeding $40 billion. In a strategic move, Meta declared its inaugural cash dividend of $0.50 per share, scheduled for payment on March 26, alongside a substantial $50 billion share buyback. This announcement significantly boosted Meta’s shares by over 14% in after-hours trading.
This remarkable success follows Meta’s implementation of a transformative strategy termed the “Year of Efficiency,” initiated by CEO Mark Zuckerberg last February. The strategy involved significant cost-cutting measures and layoffs, proving to be a highly successful effort in reversing prior revenue declines and bolstering the company’s share price.
For the entirety of 2023, Meta reported a remarkable 69% year-over-year increase in profits, reaching $39 billion. As of the latest closing bell, Meta’s stock had surged by 109% since the corresponding period of the previous year.
Meta revealed that Facebook’s daily active users grew by 6% year-over-year, surpassing 2.1 billion. However, in a notable shift, Meta CFO Susan Li announced that the company would no longer report Facebook’s user numbers. This emphasizes Meta’s strategic focus on its broader family of apps.
Mark Zuckerberg also highlighted the success of Threads, Meta’s platform competing with Twitter, which reported 130 million monthly active users.
The fourth quarter report indicated a 2% year-over-year increase in Meta’s average price per ad, a pivotal indicator for the company’s core advertising business. This marked the first growth in average price per ad for the company in the last year.
Looking forward, Meta anticipates a 20% year-over-year increase in revenue for the first quarter of 2024, with projections ranging between $34.5 billion and $37 billion.
Furthermore, Meta emphasized artificial intelligence (AI) as its primary investment area for 2024. The company expects capital expenditures between $30 billion and $37 billion, primarily driven by investments in AI, non-AI servers, and data centers.
While Reality Labs, Meta’s unit focusing on the metaverse, posted over $16 billion in losses in 2023, the company remains committed to AI and its metaverse vision.
This financial report coincides with Mark Zuckerberg’s recent Capitol Hill testimony, addressing concerns about the impact of Meta’s platforms on young users.
