Meta earnings call: More metaverse spending, and Reels videos growing fast (updated)
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After Meta Platforms (NASDAQ:META) held its third-quarter earnings conference call, the stock had fallen after hours as low as $103.08 - a new low of sorts in its recent struggles, a near-21% tumble to its lowest point since February 2016.

That followed a report where revenues did better than expected - admittedly, against a heavily lowered bar - but profits missed consensus, and those have fallen for four quarters in a row.
Revenue did grow slightly in constant currency, but "We're still behind where I think we should be," CEO Mark Zuckerberg said on the call. "But we believe that we will return to healthier revenue growth trends next year ... It's not clear that the economy has stabilized yet so we're planning our budget somewhat more conservatively."
He also tamped down worries about app growth. "Our product trends look better from what I see than the commentary I've seen suggests," Zuckerberg said on the call. "There's been a bunch of speculation about engagement on our apps and what we're seeing is more positive."
On Facebook in particular, he said, the number of people using the service daily is peaking near 2B. Instagram has more than 2B monthly active users, he added, and WhatsApp has more than 2B daily actives as well. He noted the "exciting trend" that "North America is now our fastest-growing region across the family."
Meanwhile, in the face of a call from investor Brad Gerstner to cut metaverse investments (through Meta's Reality Labs unit) to "no more than $5B per year," Meta execs were signaling that was not in the cards.
Chief Financial Officer Dave Wehner elaborated that "We do anticipate the Reality Labs operating losses in 2023 will grow significantly year over year."
And Zuckerberg amplified that point: "The internal indications I've seen suggests we're doing leading work, and are on the right track with these investments, so I think that we should keep investing heavily in these areas."
"There's still a long road ahead to build the next computing platform, but we're clearly doing leading work here. This is a massive undertaking and and it's going to take a few versions of each product before they become mainstream. But I think that our work here is going to be of historic importance and create the foundation for an entirely new way that we will interact with each other and blend technology into our lives, as well as the foundation for the long term of our business," Zuckerberg said.
Tackling another key monetization issue, Zuckerberg moved to the subject of Reels, Meta's short-video rival to the explosive growth of TikTok (BDNCE).
"There are now more than 140 billion Reels plays across Facebook and Instagram each day," Zuckerberg said. "That's a 50% increase from six months ago. Reels is incremental to time spent on our apps."
"We believe that we're gaining time-spent share on competitors like TikTok over time," he added.
As for monetization, "I mentioned last quarter that Instagram Reels had crossed a $1B annual revenue run rate. We continue scaling monetization across both Instagram and Facebook and the combined run rate across these apps is now $3B."