Meta cut its benefits in 2022 but expected worse results

American social media giant Targetthe owner of Facebook, Instagram and WhatsApp, announced a 41% drop in its profits in fiscal 2022 to $23.2 billion.

Despite the poor numbers released at the end of the session on Wall Street, technology jumped 18% in electronic transactions, which was the first good reaction from investors who had worse expectations, especially for the fourth quarter.

They calculated coldly

Targetwhich had previously warned of weak cumulative results, had a slight decline in annual turnover of 1% to 116,609 million, but was weighed down by a significant increase in costs of 23% to 87,665 million.

In November, the company announced layoffs of 11,000 people, and this year it recorded an accrual of $4,610 million related to these “restructuring efforts,” which also include the cancellation of office and project leases.

Like other tech companies, it has been hit by inflation, a weak advertising market, an increase in competition, and a normalization in demand for digital entertainment that has skyrocketed since the start of the pandemic.

Between October and December, the company earned 4,652 million (down 55%) and billed 32,165 million (down 4%), representing the third straight quarter of a decline in revenue largely driven by advertising.

Target In terms of ads, it says “impressions” (views by users) have increased across the app set, but the average cost per ad has fallen 22% in the most recent quarter and 16% year-over-year.

After last year’s stock market crash, when capitalization fell by 64%, Target announced a $40 billion share buyback plan, far exceeding the amount invested in the concept in 2022.

record numbers

Mark Zuckerberg, founder and CEO, noted that applications under the auspices of Target They continue to attract users, thanks in large part to their AI technology and Reels feature, to create short videos.

He also noted that facebook reached 2 billion active users on average in December, up 4% from last year.

Zuckerberg called this year “the year of efficiency” and said his priority is to make the company “stronger and more economical,” warning in his forecast for this year that it could “incur additional restructuring costs.”

Target He said he expects first-quarter billings to be between 26,000 million and 28,500 million, which could mean a return to growth, and overall for the year he revised down his previous cost and capital spending expectations, which appeared to have given the market hope. . . EFE

We recommend METADATA, the RPP technology podcast. News, analytics, reviews, recommendations and everything you need to know about the world of technology.