Investors beat down Meta Platforms Inc. (NASDAQ: META) stock to under $100 per share in the fall of 2022. That was from $370 barely a year before. The stock has made a round trip from that earlier level and closed at an all-time high above $384. The market cap is just shy of $1 trillion.
Meta’s revenue was soft in 2022. Its numbers rely almost completely on ad sales. What was to be a looming recession prompted worries that marketing budgets would be cut. Meta could not restart its multiyear growth machine if that happened.
Additionally, investors hated CEO Mark Zuckerberg’s investment in the Metaverse, an ill-defined attempt to bring a virtual world to the masses. This investment reached $14 billion, and Zuckerberg had nothing to show in sales or any genuine consumer interest. (Apple could buy these 25 huge companies with cash right now.)
Zuckerberg backed down from burning money on the Metaverse and laid off over 10,000 people early last year, about 12% of Meta’s total. What was left was Meta’s core business, which was advertising revenue on Facebook.
The turnaround worked. And quarterly results, which will be announced in a matter of days, should confirm that. In the most recently reported quarter, revenue rose 21% year over year to $34.1 billion. Cost cuts work well. Net income rose 168% to $11.6 billion. Zuckerberg listened to Wall Street and the shareholder payoff was huge.
What Happens Next?
The good thing about Meta Platforms for investors is that its success is easy to track. How well is digital advertising doing? On the other hand, a drop in the sector is easy to spot as well. Meta can ride that ad revenue wave as long as it continues.
The #1 Thing to Do Before You Claim Social Security (Sponsor)
Choosing the right (or wrong) time to claim Social Security can dramatically change your retirement. So, before making one of the biggest decisions of your financial life, it’s a smart idea to get an extra set of eyes on your complete financial situation.
A financial advisor can help you decide the right Social Security option for you and your family. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you.
Click here to match with up to 3 financial pros who would be excited to help you optimize your Social Security outcomes.
Have questions about retirement or personal finance? Email us at [email protected]!
By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.
By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
