The Facebook parent company beat earnings expectations but issued weak revenue guidance for the next quarter
Meta $META stock fell more than 10% Thursday, even as the Facebook parent company reported better-than-anticipated sales in its quarterly earnings the day before. The losses appeared to be driven by the company’s steep Metaverse losses, and CEO Mark Zuckerberg’s commitment to continue that spending.
The stock dropped more than 15% in pre-market trading Thursday before recovering some of those losses to close down 10.5% on the day.
Meta reported revenues of $36.5 billion for the three months ended March 31, almost 30% higher than the same period last year and ahead of the expectations of Wall Street analysts surveyed by FactSet. And its profits more than doubled to $12 billion. Earnings per share were $4.71, more than the $4.32 expected
Investors didn’t seem to care about those good fortunes, though, as Meta’s share price sank 16.5% in after-hours trading Wednesday and was down 15.3% before markets opened Thursday. They cared, instead, about its lukewarm second-quarter outlook. The company issued light revenue guidance and is expecting revenues for the three months ending June 31 at $36.5 to $39 billion.
“It’s been a good start to the year,” Meta CEO Mark Zuckerberg said in the company’s earnings release Wednesday. “The new version of Meta AI with Llama 3 is another step towards building the world’s leading AI. We’re seeing healthy growth across our apps and we continue making steady progress building the metaverse as well.”
Meta stock has more than doubled over the last year, up 39% so far in 2024 and 135% in the last 12 months. The company has been one of the top-performing tech stocks. It’s part of the so-called “Fab Four,” the A-listers of the “Magnificent Seven” big tech stocks that continue to rally even as Google $GOOGL parent Alphabet, Apple $AAPL, and Tesla $TSLA have fallen flat or worse.
–Laura Bratton contributed to this article
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