Tech giant Meta has recorded an unexpected increase in earnings in its first quarter (Q1) report after it surpassed analysts’ expectations.
Meta, the parent company of Facebook, WhatsApp, and Instagram reported higher-than-expected earnings and a growth of 3% year-on-year in its revenue, which amounted to $28.65 billion, an increase from $27.9 billion recorded last year.
The company’s revenue surpassed analysts’ prediction of $27.65 billion. On its share price, Meta recorded $2.20 per share, surpassing $2.03 per share of analysts’ expectations.
Meta’s overall earnings report however ended positively amidst the current economic downturn, rising inflation, and large-scale layoffs.
Speaking on its First quarter report for 2023, Meta’s CEO Mark Zuckerberg said “We had a good quarter, and our community continues to grow. Our AI work is driving good results across our apps and business. We are also becoming more efficient so we can build better products faster and put ourselves in a stronger position to deliver our long-term vision.”
As regards the Metaverse, it continues to take major losses, losing just under $4 billion for the quarter. That’s a bit less than the $4.3 billion the company lost last quarter, but Meta has said it expects 2023 losses for its Metaverse division to top the $14.3 billion it lost last year.
Despite reporting repeated losses in billions of dollars dedicated to developing the virtual-reality online world, Meta Chief Executive Officer Mark Zuckerberg said the company will remain committed to the project.
He said “A narrative has developed that we are somehow moving away from focusing on the metaverse vision, so I just want to say up front that that is not accurate. We have been focusing on AI and the metaverse and we will continue to. Building the metaverse is a long-term project, but the rationale for it remains the same and we remain committed to it.
Investors King understands that Meta isn’t expecting to make money from its Reality Labs yet, but it is certain it will yield the necessary profits in the long run. Several investors have expressed concerns that the huge funds poured into the project might not pay off in the end.
On the other hand, Wall Street continues to be bullish on the metaverse, with some top analysts and hedge fund managers arguing that it is the most important invention since the iPhone and will end up being worth trillions.
