post-performance carnival!
On April 27, local time, Meta, the world's largest social network company, released its first quarter financial report for fiscal year 2022 after the market closed. The first quarter net profit, earnings per share, and social platform user growth were higher than market expectations. Affected by this, Meta's stock price soared 19% after the market closed, and technology stocks such as apple and Amazon also rose.
Source: Wind
Company CEO Zuckerberg said at the performance meeting that short video Reels will grow very fast this year, and the company will increase investment in short video operations, while also investing in some AI infrastructure, business platforms, and real-world laboratories. The pace of investment will slow down this year.
The number of social platform users resumed growth
On April 27, local time, Zuckerberg said: "We are very happy to see that community users continue to grow. There are currently more users using Meta services than ever before."
Facebook daily average Number of active users
Source: Meta financial report
According to Zuckerberg, the company’s first-quarter net profit was US$7.4 billion, higher than market expectations of US$7.1 billion; earnings per share were US$2.72, higher than market expectations of US$2.56. Facebook, the company's second largest social software in the world, had 1.96 billion daily active users (DAU) in the first quarter of this year, a year-on-year increase of 4%, which was also better than market expectations.
With the announcement of first-quarter results, Meta's stock price soared nearly 19% after the market closed. Driven by Meta, Apple rose 1.4% after the bell, and Amazon rose 2.14%.
In fact, from the overall performance point of view, Meta's financial data is not eye-catching. The financial report shows that as of March 31, Meta's total revenue in the first quarter of this year was US$27.908 billion, a year-on-year increase of 7%; net profit was US$7.465 billion, a year-on-year decrease of 21%.
At present, Meta's metaverse business transformation is still in its infancy, and social applications based on advertising revenue are still the core of performance. The financial report shows that the first quarter revenue of the application series business, including the core applications instagram and whatsapp, was US$27.213 billion, a year-on-year increase of 6%, accounting for 97.5% of the quarter's revenue; net profit was US$11.484 billion, a year-on-year decrease of 15%.
However, compared with the 2021 full-year financial report released in early February this year, the recovery in the growth of social platform users has boosted market confidence. The 2021 annual financial report shows that the number of Facebook active users will only increase by 3.93% in 2021, which is the lowest growth rate in history.
It is worth mentioning that from a regional perspective, the number of Facebook daily active users in Europe declined month-on-month, while the rest of the regions maintained growth. Analysts at CICC said that due to antitrust investigations into Facebook by , the European Union, , the United Kingdom, and the United States, the company may still be unable to escape the impact of antitrust incidents in the future.
The Metaverse business is still in the stage of research and development and capital investment.
Zuckerberg said that the company’s three performance growth engines in the future are short video function Reels, advertising and Metaverse. "In the first quarter of this year, the growth of short videos was very fast. The time users spent using the short video function Reels on Instagram accounted for 20% of the total time spent on Instagram. Therefore, the company will invest more energy in Reels."
Metaverse, Zuckerberg said that the Metaverse business is still in the stage of continuous research and development and capital investment, which is a long-term strategic goal of the company. The financial report for the first quarter of 2022 shows that the Reality Laboratory, which is responsible for the Yuan Universe development project, achieved revenue of US$695 million in the first quarter, a year-on-year increase of 30.15%; a net loss of US$2.96 billion, a year-on-year increase of 62.01%.
Zuckerberg proposed that the company plans to slow down some investments in AI infrastructure, commercial platforms and real-life laboratories, with the goal of generating sufficient operational growth. Regarding the company's next performance, Zuckerberg said that the total revenue in the second quarter of 2022 is expected to reach 28 billion to 30 billion U.S. dollars, and the total expenditure for the whole year of 2022 will be between 87 billion and 92 billion U.S. dollars, lower than the company's previous expectations. Of US$90 billion to US$95 billion, cost growth will be driven primarily by the application series segment, followed by real-life laboratories.
Editor: Zhang Jing
