Meta Platforms jumps 10% as Facebook ads recover, users steadily grow
Justin Sullivan/Getty Images News
Meta Platforms stock (NASDAQ:META) jumped 10% after hours following first-quarter earnings where it easily beat expectations on top and bottom lines, thanks to a better-than-expected ad recovery at its flagship Facebook platform.
Revenues overall rose 3% to $28.65B, clearing expectations by roughly $1B, though higher costs led to a 15% drop in operating income (to $7.23B). Operating margin declined to 25% from a year-ago 31%.
The company also paid a higher effective tax rate, which helped lead to net income dropping 24% to $5.7B -- still significantly better than analysts expected.
"We had a good quarter and our community continues to grow," said founder/CEO Mark Zuckerberg.
"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.
Facebook daily active users rose 4% to a better-than-expected 2.04B, and monthly active users were 2.99B, roughly in line with expectations. For the wider "family of apps" (including Instagram and WhatsApp), daily active people rose 5% year-over-year to 3.02B and monthly active people rose 5% to 3.81B, both beating consensus.
The company's guiding to Q2 revenue of $29.5B-$32B, on the high side of consensus for $29.5B, on the assumption that foreign currency headwinds will be limited to less than 1% to year-over-year revenue growth.
For the full year, it now sees total expenses of $86B-$90B, inclusive of $3B-$5B of restructuring costs, and expects Reality Labs operating losses to increase this year. Meta also maintained its capital expenditure forecast of $30B-$33B (still building out AI capacity to support ads, Feed, and Rees, and more investment in generative AI).
Conference call to come at 5 p.m. ET.