Facebook parent Meta reported earnings after the bell. Here are the results.
- Earnings per share (EPS): $1.64 vs $1.89 expected, according to Refinitiv
- Revenue: $27.71 billion vs. $27.38 billion expected, according to Refinitiv
- Daily Active Users (DAUs): 1.98 billion vs 1.98 billion expected, according to StreetAccount
- Monthly Active Users (MAUs): 2.96 billion vs 2.94 billion expected, according to StreetAccount
- Average Revenue per User (ARPU): $9.41 vs. $9.83 expected, according to StreetAccount
Facebook’s parent is contending with a broad slowdown in online ad spending, challenges from Apple’s iOS privacy update and increased competition from TikTok. Add it up, and Meta is expected to post its third straight quarter of declining sales for the year.
The company said revenue for the fourth quarter will be $30 billion to $32.5 billion. Analysts were expecting sales of $32.2 billion.
Meta’s revenue declined 4% year over year to $27.7 billion in the third quarter. Meanwhile, the company’s costs and expenses rose 19% year over year to $22.1 billion. Operating income declined 46% from the previous year to $5.66 billion.
The Facebook parent’s operating margin, or the profits left after accounting for costs to run the business, sank to 20% from 36% a year earlier.
Revenue in the Reality Labs unit, which houses the company’s virtual reality headsets and its futuristic metaverse business, fell by almost half from a year earlier to $285 million. Its loss widened to $3.67 billion from $2.63 in the same quarter last year.
Reality Labs has lost $9.4 billion so far this year.
Meta said that it is “holding some teams flat in terms of headcount, shrinking others and investing headcount growth only in our highest priorities.”
“As a result, we expect headcount at the end of 2023 will be approximately in-line with third quarter 2022 levels,” the company added in a statement.