Meta Platforms (FB) reported first-quarter results late Wednesday that fell short on revenue, as did its sales forecast for the second quarter. But the company surprised investors as earnings came in better than expected. FB stock jumped in after-hours action.
The company reported adjusted income of $ 2.72 a share on revenue of $ 27.9 billion. Analysts expected Meta to report earnings of $ 2.56 a share on revenue of $ 28.3 billion, according to FactSet.
FB stock jumped 15.4% to 202.30 during after-hours trading on the stock market today.
Revenue rose 7% from the year-ago period. Daily active users climbed 4% from the year-ago period to 1.96 billion, meeting estimates. And monthly active users climbed 3% to 2.94 billion.
Meta expects second-quarter revenue to be in the range of $ 28 billion to $ 30 billion. The midpoint of $ 29 billion is below estimates of $ 30.7 billion.
Shifting From Social Network To Metaverse
Meta is undergoing a major and costly shift from social networking to the metaverse. It faces several other challenges.
For example, it continues to see revenue declines due to Apple changing its iPhone operating system to reduce ad tracking. It also faces increased competition from TikTok and remains under pressure over allegations of antitrust from Congress.
At the same time, digital ad spending decisions remain in flux with many small and medium-sized businesses considering new channels away from Meta for the first time.
In mid-April, two analysts lowered their price target on FB stock, raising concerns over the Russia-Ukraine conflict and its impact on European economies, as well as shifts in digital advertising.
FB stock is down about 46% this year.
FB Stock: Confident In Long-Term Opportunities
“We made progress this quarter across a number of key company priorities, and we remain confident in the long-term opportunities and growth that our product roadmap will unlock,” said Chief Executive Mark Zuckerberg, in written remarks with the Meta earnings release.
“More people use our services today than ever before, and I’m proud of how our products are serving people around the world,” he said.
Meta expects 2022 expenses in the range of $ 87 billion to $ 92 billion. That’s below its previous outlook of $ 90 billion to $ 95 billion.
Please follow Brian Deagon on Twitter at @IBD_BDeagon for more on tech stocks, analysis and financial markets.
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