Q3 2024 Meta Earnings Report

Meta reported weaker-than-expected user numbers and warned of a significant acceleration in its infrastructure spending in 2025 in its third-quarter earnings report on Wednesday.

The company's share price fell slightly in after-hours trading.

Here are the results.

• Earnings per share: $6.03 versus $5.25 expected from LSEG
• revenue: $40.59 billion versus LSEG's expected $40.29 billion

Revenue rose 19% year over year in the third quarter, while net income rose 35% to $15.7 billion, compared to $11.6 billion a year earlier. This represents Meta's lowest annual net income growth since the second quarter of 2023.

The company reported 3.29 billion daily active people for the third quarter. That was up 5% from a year earlier, but fell short of analysts' expectations of 3.31 billion.

Meta also raised its fiscal 2024 capital expenditure forecast to $38 billion to $40 billion, up from $37 billion to $40 billion previously. In addition, the company expects capital expenditure to continue to increase significantly in 2025.

The company expects “a significant acceleration in infrastructure cost growth next year as we see higher growth in depreciation and operating costs of our expanded infrastructure fleet,” Meta said in a press release.

Meta said total spending for fiscal 2024 is expected to be between $96 billion and $98 billion, down from the previous forecast of $96 billion to $99 billion.

Revenue from Meta's advertising business was $39.9 billion in the quarter, up 18.7% year over year. Advertising accounted for 98.3% of Meta's total revenue in the third quarter.

Meta said it expected fourth-quarter revenue to be between $45 billion and $48 billion. The midpoint of this forecast is above the analyst consensus of $46.3 billion.

The company's Reality Labs hardware division posted a third-quarter operating loss of $4.4 billion, below analysts' expectations of $4.68 billion. Third-quarter revenue for the division rose 29% year-over-year to $270 million, falling short of analysts' expectations of $310.4 million.

Since 2020, Meta's Reality Labs unit reported an operating loss of more than $58 billion.

The company's total headcount increased 9% year over year to 72,404 as of September 30.

Meta CEO Mark Zuckerberg has highlighted the company's massive investments in artificial intelligence, which include billions of dollars Nvidia's popular graphics processing units that will help improve the company's core online advertising business following Apple's 2021 iOS privacy update.

The social media company's results come a day after digital advertising companies alphabet, Reddit And Snap All reported solid quarterly results. Microsoft reported third-quarter earnings on Wednesday that beat both revenue and profit.

Apple And Amazon report quarterly financial figures on Thursday.

REGARD: Meta's sales still have room to maneuver despite all the AI ​​spending.