Meta’s pursuit of efficiency in what they dubbed the “year of efficiency” has proven highly successful, yielding remarkable financial results. The tech giant reported a staggering 200% year-over-year profit growth to $14 billion for the three months ending in December, surpassing Wall Street expectations. Additionally, quarterly sales increased by 25%, reaching over $40 billion.
In a strategic move to reward investors, Meta declared its first-ever cash dividend of $0.50 per share, scheduled for payment on March 26 to shareholders recorded as of February 22. The company also initiated a $50 billion share buyback, actions that typically boost stock prices but are often criticized for diverting resources from essential business improvements.
Meta’s shares experienced a notable surge of over 14% in after-hours trading following the announcement.
This financial success marks the culmination of Meta’s year-long commitment to efficiency, spearheaded by CEO Mark Zuckerberg. The turnaround strategy, implemented through cost-cutting measures such as layoffs, has effectively reversed previous revenue declines and strengthened the company’s share prices.
For the entire fiscal year of 2023, Meta reported a 69% year-over-year profit increase, reaching $39 billion. As of the latest closing bell, Meta’s stock had soared by 109% since the corresponding period the previous year.
During a call with analysts, Zuckerberg expressed gratitude to employees, partners, shareholders, and the community for contributing to Meta’s remarkable success in 2023. The positive report follows Zuckerberg’s recent appearance on Capitol Hill, where he apologized for the impact of Meta’s platforms on young users.
While Meta revealed a 6% year-over-year growth in daily active users on Facebook, it signaled a shift away from reporting specific Facebook user numbers. Instead, the company will focus on its broader family of apps, which amassed an average of 3.19 billion daily active people in December.
Meta’s rival to Twitter, Threads, has demonstrated strong growth with 130 million monthly active users, although it remains smaller than its competitors.
A noteworthy highlight from the report is a 2% year-over-year increase in Meta’s average price per ad in the December quarter, marking a positive turn for the company’s core advertising business.
Looking ahead, Meta anticipates a 20% year-over-year revenue jump in the first quarter of 2024, projecting a range between $34.5 billion and $37 billion.
In terms of future investments, Meta revealed that artificial intelligence (AI) would be a primary focus in 2024, with an expected capital expenditure of $30 billion to $37 billion. The company aims to expand its infrastructure to support ambitious long-term AI research and product development efforts.
Despite a more than $16 billion loss in 2023 for its Reality Labs unit, responsible for building the metaverse, Meta plans to increase investments in this area. The company aims to continue its commitment to AI innovation, including the development of its own artificial general intelligence (AGI).