Meta's Stock Slides After Q1 Earnings Report
Shares Drop 10% in After-Hours Trading
Meta Platforms' (META) stock fell 10% in volatile after-hours trading on Wednesday, following the release of its first-quarter earnings report. The stock had already slid 0.5% during regular trading hours, but the after-hours drop represents a significant decline.
Key Financial Metrics
The company reported a decline in revenue for the first time in its history, with Q1 revenue falling 1.2% year-over-year to $27.91 billion. Meta's net income also decreased by 21% to $7.47 billion.
The loss in revenue was primarily attributed to a drop in advertising revenue, which declined by 3.5% year-over-year. This was further impacted by the ongoing macroeconomic challenges and the company's recent privacy changes, which have made it more difficult for advertisers to target users.
Despite the revenue decline, Meta's user base continued to grow. The company reported 2.91 billion monthly active users (MAUs) on Facebook, an increase of 3% year-over-year.
Meta also announced that it would be increasing its stock buyback program by $10 billion, bringing the total amount authorized for buybacks to $40 billion.
Market Reaction
The after-hours slide in Meta's stock price reflects investors' concerns about the company's revenue decline and the impact of its privacy changes on its advertising business.
Analysts are divided on the long-term implications of Meta's earnings report. Some believe that the company's focus on the metaverse and other long-term projects will eventually bear fruit, while others are more cautious about the near-term challenges it faces.
It remains to be seen how Meta will respond to the challenges it is currently facing. The company has a history of adapting to changing market conditions, and it will be interesting to see what steps it takes to regain investors' confidence.
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