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Meta Platforms reports first increase in sales in nearly a year
Meta Platforms Inc $Meta Platforms (META.US)$. reported a 3% year-over-year increase in revenue for the first quarter of 2023, marking the first revenue increase in nearly a year. The uptick was due to continued improvements in Meta’s advertising business, and the company's heavy investment in artificial intelligence tools to improve its ad-targeting systems seems to be working.
Facebook CEO Mark Zuckerberg attributes the gains to Reels, the company's short-form video product, which he believes is increasing overall app engagement and helping Meta gain share in the short-form video market.
Shares of Meta surged by more than 12% in after-hours trading, as the company forecasted that second-quarter revenue could reach as high as $32 billion.
Despite growing competition from TikTok, Meta’s efforts in AI, along with shifting to forms of advertising less dependent on harvesting user data from its platforms, are essential to the company’s plans to bounce back.
Zuckerberg expects generative AI to have an impact on every one of Meta’s apps and services, and the technology could help marketers create advertisements for Meta’s services, power chatbots for businesses on Messenger and WhatsApp, and help metaverse users create avatars and virtual worlds.
The company reported a net profit of $5.7 billion for the first quarter, a roughly 24% decline from the year-ago period, but it is up from $4.7 billion in the October-to-December quarter. Meta’s shares fell by about two-thirds in 2022, erasing more than $600 billion in market value. After Zuckerberg's efficiency push, the stock has rebounded this year, rising more than 70% through Tuesday’s close.
Source: The Wall Street Journal
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