Meta Platforms Inc forecast second-quarter revenue above market expectations as digital advertisers pivot to tried and tested platforms such as Facebook and Instagram amid growing economic worries.
Shares of the Facebook-parent rose nine per cent after the bell on Wednesday as its profit also beat Wall Street estimates.
The strong results come as Meta’s tech rivals appeared to be climbing out from an industry-wide slump that has prompted more than 150,000 layoffs across the sector.
Google parent Alphabet Inc reported strong results on Tuesday as its digital ad sales held up better than expected and demand rose for cloud services.
Microsoft likewise beat Wall Street’s estimates and said artificial intelligence products were stimulating sales.
Meta has kicked off an aggressive cost-cut drive, with plans to eliminate 21,000 jobs and flatten its middle-management structure as it works towards CEO Mark Zuckerberg’s goal of turning 2023 into the “year of efficiency.”
“Our AI work is driving good results across our apps and business. We’re also becoming more efficient so we can build better products faster and put ourselves in a stronger position to deliver our long term vision,” Zuckerberg said.
The company had narrowed its annual expenses forecast to between $86 billion and $90 billion from $86 billion to $92 billion it had predicted earlier.
Meta said its quarterly price per ad decreased 17 per cent from a year earlier, while it expects current-quarter revenue between $29.5 billion and $32 billion, compared with analysts’ estimates of $29.53 billion, according to Refinitiv data.
Net profit for the first three months of the year fell to $2.20 per share from $2.72 a year earlier, but beat expectations of $2.03.
Revenue for the first quarter stood at $28.65 billion, compared with an average estimate of $27.66 billion.
(Reporting by Akash Sriram in Bengaluru; Editing by Arun Koyyur)