Meta, the parent company of Facebook, reported a remarkable 164% increase in its net profit for the third quarter, driving a surge in after-hours trading. This robust performance was fueled by a revival in core digital advertising revenue and a notable uptick in user numbers. During the quarter ending on September 30, Meta’s net profit reached approximately $11.6 billion, marking a substantial 48.7% increase compared to the previous quarter. The company’s revenue for the same period experienced a solid annual growth of 23%, surpassing analyst expectations at more than $34.1 billion. This achievement marked the second consecutive quarter of double-digit revenue growth since Q4 2021. Despite an initial 4.4% gain in after-hours trading, Meta’s shares later retreated. Year-to-date, the stock has seen a remarkable increase of about 140.12%, and the company’s market value closed at approximately $770.74 billion.
In Q3, Meta witnessed a 31% annual increase in advertising impressions delivered across its family of apps, with a simultaneous 6% year-on-year decrease in the average price for advertisements. Meta’s founder and CEO, Mark Zuckerberg, commended the company’s achievements, particularly the advancements in artificial intelligence and mixed reality with the launch of products like Quest 3 and Ray-Ban Meta smart glasses. Meta also reported a substantial 168% annual increase in earnings per share, reaching $4.39 for the third quarter. The company anticipates a positive outlook for the December quarter, projecting total revenue in the range of $36.5 billion to $40 billion. Analysts view this strong guidance as a sign of Meta potentially emerging from recent challenges, particularly due to Mark Zuckerberg’s cost-cutting initiatives. Advertising sales constituted over 98.5% of Meta’s overall Q3 revenue, increasing by around 23.5% annually to surpass $33.6 billion. Additional revenue streams, including the Reality Labs unit, also contributed to growth. However, Reality Labs reported an operating loss of over $3.7 billion, attributed to ongoing investments in augmented and virtual reality efforts for the metaverse. Meta has adjusted its expense and capital expenditure outlook for the year and foresees continued growth in 2024, driven by investments in servers, data centers, and AI hardware.