Meta (META) is scheduled to report first-quarter earnings after the bell on Wednesday, with Wall Street expecting another big revenue increase from the social media giant. Meta's share price has plummeted, with he up 116% in the past 12 months. 45% since the beginning of the year. This is much better than his 45% rise at archrival Google (GOOG, GOOGL). 16% in the last 12 months year to date.
While some of Meta's stock performance is tied to the recovery in the digital advertising market, the social media company announced it would start paying a $0.50 per share dividend and increase its share buyback authorization by $50 billion. 's stock price really skyrocketed last quarter. .
Wall Street expects Meta to report first-quarter earnings of $4.30 per share on revenue of $36.1 billion, according to analyst estimates compiled by Bloomberg. This represents an even bigger increase in EPS and revenue from the same period last year, when the company reported earnings of $2.20 on revenue of $28.6 billion.
But JPMorgan Securities analyst Doug Anmas said Meta's rapid growth could face challenges in the coming months.
“Due to difficult economic conditions, there is growing concern about earnings with the near certainty of a slowdown in growth from the first quarter onwards.” [comparisons] Perception of lack of new drivers vs. [2023]” Mr. Ammas wrote in his recent financial report.
Wedbush analyst Scott Devitt was similarly cautious in his analyst note, saying he would primarily focus on “the expected pace of second-quarter and second-half growth for more challenged companies.”
Despite its potential headwinds, Meta is moving forward with a number of strengths, including its continued efforts to take on TikTok on its Reels platform. The company has also emerged as a potential early winner in the AI space, with technology that improves Meta's overall advertising capabilities.
Meta has made a series of announcements about its AI efforts in recent months, including debuting the Meta AI chatbot and Llama 3 large language model on April 18th. But the chatbot has already caused controversy after joining a private Facebook group for mothers in the United States. She claimed to have a child of her own in Manhattan, 404 Media reported.
The bot is available on Facebook, Instagram, WhatsApp, Messages, and the Meta.AI website, and you can't turn it off if you don't want to use it.
Despite Meta's increasing focus on AI, CEO Mark Zuckerberg hasn't given up on his quest to realize his vision for the Metaverse. He took another step Monday to increase the number of AR/VR headsets on the market, with Meta open sourcing the Horizon operating system for headsets, allowing third-party companies to use it to create their own. announced that it will be possible to build devices such as
Email Daniel Howley at dhowley@yahoofinance.com. Follow him on Twitter @Daniel Howley.
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