A day after the firm announced impressive third-quarter earnings, Meta’s shares fell more than 6% on Thursday. However, the company also issued cautious remarks regarding possible ad softness brought on by the ongoing Israel-Hamas conflict.
Meta recorded revenue of $34.15 billion for the quarter, a 23% increase and the fastest growth rate since 2021. At $11.58 billion, or $4.39 per share, the company’s net income surged 164%. After the company’s key digital advertisements business declined for three consecutive quarters in 2022, investors were relieved to see both sales and earnings above Wall Street’s estimates.
The report caused Meta’s shares to rise initially, but the gains were quickly reversed when Susan Li, the company’s finance chief, alerted analysts of the instability in the Middle East. Meta issued fourth-quarter forecasts ranging from $36.5 billion to $40 billion due to the Israeli diplomatic crisis. Compared to the $2.5 billion difference the corporation usually offers, the range is greater.
On the analyst call, Li stated, “We have witnessed lower advertisements in the beginning of the fourth quarter, aligning with the commencement of the conflict, which is captured in our Q4 revenue outlook.”
Source (CNBC)
