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I confirm my intention to proceed and enter this websiteMeta (META.US), the parent company of Facebook, disclosed its March quarter financial results, revealing revenues of $36.5 billion, which marked a 27% increase from the previous year, and earnings of $4.71 per share, surpassing the anticipated figures. The company’s quarterly revenue landed within its projected $34.5 billion to $37 billion range, also outdoing the FactSet consensus projection of $36.1 billion.
For the quarter ending in June, Meta predicts that its revenue will be in the $36.5 billion to $39 billion ballpark, with a median figure of $37.8 billion just shy of the average prediction of $38.2 billion. Such projections could trigger worries regarding the expansion outlook for other advertising-centric online entities.
Meta’s commitment to securing a vanguard position in the burgeoning field of generative AI is leading to elevated expenses. To back its AI pathway, the corporation upped its cost estimates due to requisite infrastructural enhancements, causing a downturn in Meta’s share value of over 15% during extended trading.
The anticipated total expenses for the year have been adjusted to a bracket of $96 billion to $99 billion from the formerly broader range of $94 billion to $99 billion. Moreover, Meta assumes its capital expenditures to be between $35 billion and $40 billion, a notch above the initially expected $30 billion to $37 billion due to escalated expenditures on AI initiatives. The past year saw Meta’s capital outlays at $32 billion, while it was $28.1 billion the year before that.
Despite Meta shares climbing notably since late 2022, energized by cost management strategies in its “Year of Efficiency” and its prominent emergence in the AI sector, this growth is tempered by the clash with AI operations. Such AI endeavors demand high-cost infrastructure and the recruitment of sought-after AI experts, which might undermine the advantages of the trimming measures.
(Meta Stock Performance Monthly Chart)
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