On April 27th, Meta released its first quarterly financial report for 2022. With it, the company manages to defy the gloomy expectations of consumers and investors alike. The key takeaway – more users, more revenue, less growth.
One figure particularly stands out – 2.94 billion – the number of users that log into Facebook on a monthly basis. This is just one of the many indicators that Meta, despite ever stronger competition and the global challenges it is facing, is very much still holding on. The report also announced growth in other key areas like total revenue and ad prices.
After a certain period of stagnation and loss of users, Facebook seems to be once again gaining some, albeit limited, traction. The number of daily users also showcases a 4% net increase on a yearly basis. This also comes in the aftermath of the suspension of the social media platform in Russia.
Naturally, these revelations triggered a rise in Meta’s share prices, which rose by more than 15% following the announcement. This is no doubt a breath of fresh air for the company, especially after the rather disappointing financial report by Alphabet, the parent company of Google, for the same fiscal quarter. It should also be noted that Meta’s share prices had been steadily depreciating for some months now.
Now would be a good time for a small disclaimer. The financial growth of Meta is indeed above analysts’ projections, but it is in fact slowing down. The roots of this stagnation run deeper than the war in Ukraine. Apple’s push for protecting the data of its users and increasingly more stringent data regulations (especially in the EU) are truly pushing the company’s business model to its limits.
Reality Labs, the project that represents Meta’s grandest ambition – establishing the metaverse – still operates on a loss and contributed just 2.5% of the company’s revenue. All this calls into question whether Meta will have the means to sustain its own future, let alone pave the way for the one it aims to build for everyone else.