Meta Platforms, the parent company of social media giants Facebook and Instagram, reported robust earnings for the December quarter, driven by strong ad sales. The company also declared its first-ever dividend, resulting in a significant spike in its shares.
In Q4, Meta Platforms’ revenue saw a notable 25% increase, reaching $40.1 billion, surpassing analysts’ projections of $39.2 billion, as per LSEG data. Earnings per share experienced an impressive surge of over 200%, totaling $14 billion or $5.33 per share, exceeding estimates of $4.97 per share.
Days before Facebook’s 20th-anniversary celebration, Meta Platforms announced a dividend of 50 cents per share and authorized an additional $50 billion in share repurchases. The move contributed to a more than 14% surge in Meta Platforms’ stock price after the market closed. The company’s market valuation witnessed a remarkable increase of over $140 billion, surpassing the entire value of smaller social media competitor Snap Inc.
Mark Zuckerberg, Meta CEO, highlighted the company’s progress in advancing artificial intelligence (AI) and the metaverse. The positive momentum in Meta’s stock has been sustained, with the company hitting record highs for the first time in over two years.
For the first quarter, Meta forecasts revenue in the range of $34.5 billion to $37 billion, surpassing Wall Street expectations of $33.8 billion. The company anticipates total expenses for the full year 2024 to remain unchanged at $94 billion to $99 billion.
The Reality Labs division, focused on the metaverse, reported record sales of $1.1 billion in Q4, surpassing estimates. The strong sales of the Quest device during the holiday season contributed to this success. Meta Platforms indicated that operating losses for Reality Labs are expected to “increase meaningfully” in 2024 as the company invests more in augmented and virtual reality.
Meta Platforms’ share price has been on a steady recovery path since the challenges faced in 2022, witnessing a rebound in user growth and digital ad sales. The recent positive financial results and strategic moves, including the dividend declaration, continue to bolster the company’s resurgence.
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