Facebook user numbers rebounded last quarter, but the metaverse business lost another $2.9 billion.

What just happened? Facebook’s Daily Active Users (DAUs) increased in the first quarter of 2022, following its first-ever decline a quarter earlier, helping lift its stock by 19%. But the AR and VR division (Reality Labs), an important part of its metaverse plans, lost $2.96 billion, adding to a $10.2 billion loss recorded last year.

It was a mixed bag of the first quarter earnings results for Meta. Facebook’s DAUs, which fell from 1.93 billion to 1.92 billion in the fourth quarter of 2021, rose to 1.96 billion in the first quarter of 2022, surpassing Wall Street estimates of 1.95 billion. But the company’s total quarterly revenue of $27.91 billion falls short of analyst estimates of $28.20 billion, up 7% from a year earlier, the lowest since Facebook went public a decade ago. and 21% lower than a year earlier.

At the combined Meta companies, including Facebook, Instagram and WhatsApp, DAUs increased 6% year-on-year to 2.87 billion, or about 36% of the world’s population. But net income from its family of apps fell 13% year-on-year to $11.48 billion.

“Today, more people use our services than ever before, and I am proud of how our products serve people around the world,” said Meta CEO Mark Zuckerberg.

The metaverse vision is a big part of her plans, hence the name change last year, but it will take a lot of time and money. Reality Labs’ $2.96 billion loss is more than one billion dollars more than the $1.83 billion the company lost a year ago. However, Zuckerberg insisted that the project would pay off by the end of the decade. “First of all, it sets the stage for what I expect to be a very exciting 2030,” he said, though not all Meta employees are as enthusiastic about the metaverse as their leader.

The next quarter is not expected to be good for the Meta. Russia’s invasion of Ukraine and rising inflation are expected to see monthly active users flat or falling, with revenue projected to be between $28 billion and $30 billion, below analysts’ estimates of $30.6 billion.

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