Meta Thursday reported a 25 percent increase in quarterly revenue while its profit more than tripled, a rise fueled by its advertising business after 18 months of shaky layoffs and a tough digital advertising market.
The Silicon Valley company, which owns Facebook, Instagram and WhatsApp, also announced it would pay its first dividend, of 50 cents per share. Dividends are generally associated with mature, slower-growing companies. Meta made the announcement as it is spending heavily on capital investments, such as data centers and other infrastructure. The company also authorized an additional $50 billion in share buybacks.
“We had a strong quarter as our community and business continue to grow,” said Mark Zuckerberg, founder and CEO of Meta. “We have made a lot of progress in our vision of AI progress and the metaverse.”
For the quarter ended Dec. 31, Meta’s revenue was $40.1 billion, up from $32.2 billion a year ago and beating Wall Street estimates of $39 billion. dollars, according to data compiled by FactSet. Profit amounted to $14 billion, compared to $4.65 billion a year earlier.
The company has benefited from a continued rebound in digital ads, even as marketers remain cautious about allocating their ad budgets. On Tuesday, Google reported search revenue and profit margin for its latest quarter that fell short of Wall Street expectations due to modest advertising growth.
Meta has endured a tumultuous few years as the global economy changed and shook online advertising markets. The company has also faced scrutiny due to privacy concerns and the spread of misinformation and toxic content on its platforms.
Mr. Zuckerberg moved the company into the immersive digital world of the Metaverse. Last year, it also embarked on what it called a “year of efficiency” to cut costs, including laying off tens of thousands of employees. The company’s headcount has decreased by 22% since December 2022 and now stands at 67,317 employees.
Meta remains under pressure to rein in harmful content on its platforms, which are regularly used by more than four billion people. On Wednesday, Mr. Zuckerberg – along with other tech executives – was questioned at a congressional hearing about the proliferation of child sexual abuse material online. Mr. Zuckerberg told the hearing participants that he was sorry for what the families of children who were victims of online abuse had experienced.
Despite this, more and more people are regularly returning to Meta’s services. The company hosts more than 3.98 billion users on its applications each month, an increase of 6% compared to last year.
The company also continues to invest heavily in artificial intelligence and redesigning its data centers to keep pace with other tech giants in this highly competitive field. Meta said part of its increased operating expenses came from attracting top AI technical talent.
But the company said layoffs and some other cost-cutting measures, such as restructuring its data centers, were “complete.” It took a $1.1 billion restructuring charge for the quarter.
Meta said it expects to continue its growth in the current quarter, with revenue between $35 billion and $37 billion.
The company also increased its capital spending forecast from $30 billion to $37 billion over the course of 2024. Much of that spending will include building and maintaining its infrastructure, as well as exploding research costs and development in AI.