Facebook and Instagram parent company Meta said Wednesday its first-quarter profit more than doubled, boosted by higher advertising revenue and a 6% increase on the average price of ads on its platforms. But its shares dropped sharply in after-hours trading following lukewarm revenue guidance.
Meta Platforms Inc. earned $12.37 billion, or $4.71 per share, in the January-March period. That's up from $5.71 billion, or $2.20 per share, in the same period a year earlier.
Revenue rose 27% to $36.46 billion from $28.65 billion.
Analysts, on average, were expecting earnings of $4.32 per share on revenue of $36.14 billion, according to a poll by FactSet.
For the current quarter, the Menlo Park, California-based company said it expects revenue between $36.5 billion and $39 billion. Analysts are expecting revenue of $38.25 billion for the second quarter, which is higher than the midpoint of Meta's guidance range.
Meta also said it expects its 2024 capital expenses to be higher than anticipated due to its investments in artificial intelligence. It is forecasting expenses in the range of $35 billion to $40 billion, up from its earlier guidance of $30 billion to $37 billion.
The company has been investing heavily in AI and earlier this month unveiled a new set of artificial intelligence systems that are powering what CEO Mark Zuckerberg calls “the most intelligent AI assistant that you can freely use.”
Meta, along with leading AI developers Google and OpenAI, and startups such as Anthropic, Cohere and France’s Mistral, have been churning out new AI language models and hoping to persuade customers they’ve got the smartest, handiest or most efficient chatbots.
“Meta’s earnings should serve as a stark warning for companies reporting this earnings season," said Thomas Monteiro, senior analyst at Investing.com “Even though the company did beat estimates in all top- and bottom-line metrics, it didn’t matter as much as the reported lowering revenue expectations for Q2. This is the exact opposite of what Tesla did yesterday and goes to show that investors are currently looking at the near future with heavy mistrust.”
On Tuesday, electric vehicle maker Tesla reported that its first-quarter net income plummeted 55%. But it said it would accelerate production of new, more affordable vehicles, and on Wednesday its stock rose 12%.
The number of people using Meta's apps, meanwhile, continued to increase, with 3.24 billion users on average for March in its “family of apps” that includes Facebook, Instagram, WhatsApp and Messenger. That's up 7% year-over-year. Beginning this quarter, the company will no longer disclose user figures for Facebook.
Meta had 69,329 workers as of March 31, a decrease of 10% year-over-year. Zuckerberg called 2023 the “year of efficiency" and the company laid off thousands to reduce expenses.
Meta's shares fell 16% in after-hours trading. Meta's stock price has more than doubled over the past year thanks to a rebound in online advertising.
FILE - A Meta Portal Go is displayed during a preview of the Meta Store in Burlingame, Calif., on May 4, 2022. Meta reports earnings on Wednesday, April 24, 2024. (AP Photo/Eric Risberg, File)
TEL AVIV, Israel (AP) — A delegation of the Palestinian militant group Hamas was in Cairo on Saturday as Egyptian state media reported “noticeable progress” in ongoing cease-fire talks with Israel while an Israeli official downplayed the prospects for a full end to the war.
Pressure has been mounting to reach a deal — Gaza's humanitarian crisis is dramatically escalating while Israel insists it will launch an offensive into Rafah, the territory's southernmost city.
The stakes are high to find a halt to the nearly seven-months-long war. More than 1 million Palestinians are sheltering in the city of Rafah, along the border with Egypt, many having fled northern Gaza where a top U.N. official says there is now a full-blown famine.
Egyptian and American mediators have reported signs of compromise in recent days but chances for a cease-fire deal remain entangled with the key question of whether Israel will accept an end to the war without reaching its stated goal of destroying Hamas.
Egyptian state Al-Qahera news said Saturday that a consensus has been reached over many of the disputed points but did not elaborate. Hamas has called for a complete end to the war and withdrawal of all Israeli forces from Gaza.
The war has killed more than 34,000 Palestinians, according to Gaza’s local health officials, caused widespread destruction and plunged the territory into an unprecedented humanitarian crisis.
The conflict erupted on Oct. 7, when Hamas attacked southern Israel, abducting about 250 people and killing around 1,200, mostly civilians. Israel says militants still hold around 100 hostages and the remains of more than 30 others.
A senior Israeli official, speaking on condition of anonymity to discuss ongoing negotiations, played down the prospects for a full end to the war. The official said Israel was committed to the Rafah invasion and told The Associated Press that it will not agree in any circumstance to end the war as part of a deal to release hostages.
Israeli strikes early Saturday on Gaza killed at least six people. Three bodies were recovered from the rubble of a building in Rafah and taken to Yousef Al Najjar hospital. A strike in the Nuseirat refugee camp in central Gaza also killed three people, according to hospital officials.
In the last 24 hours, the bodies of 32 people killed by Israeli strikes have been brought to local hospitals, Gaza’s Health Ministry said Saturday. The ministry does not distinguish between fighters and civilians in its tallies, but says that women and children make up around two-thirds of those killed.
The Israeli military says it has killed 13,000 militants, without providing evidence to back up the claim.
In related developments this week, Israel briefed Biden administration officials on plans to evacuate civilians ahead of the Rafah operation, according to U.S. officials familiar with the talks.
The United Nations has warned that hundreds of thousands would be “at imminent risk of death” if Israel moves forward into the densely packed city, which is also a critical entry point for humanitarian aid.
The U.S. director of the U.N. World Food Program, Cindy McCain, said Friday that trapped civilians in the north, the most cut-off part of Gaza, have plunged into famine. McCain said a cease-fire and a greatly increased flow of aid through land and sea routes was essential.
Israel recently opened new crossings for aid into northern Gaza, but on Wednesday, Israeli settlers blocked the first convoy before it crossed into the besieged enclave. Once inside Gaza, the convoy was commandeered by Hamas militants, before U.N. officials reclaimed it.
The proposal that Egyptian mediators had put to Hamas sets out a three-stage process that would bring an immediate, six-week cease-fire and partial release of Israeli hostages, and would include some sort of Israeli pullout. The initial stage would last for 40 days.
Hamas would start by releasing female civilian hostages in exchange for Palestinian prisoners held by Israel.
Gershon Baskin, director for the Middle East at the International Communities Organization, said it appears that Hamas has agreed to the framework that Egypt proposed and Israel has already accepted.
He said the negotiators are now hammering out the details — and if Israel sends its top negotiators to Cairo after the Sabbath ends on Saturday evening, that would signify it's very serious.
Jeffery reported from Jerusalem. Associated Press writers Josef Federman in Jerusalem and Bassem Mroue in Beirut contributed to this report.
The Chahine family prepares to bury two adults and five boys and girls under the age of 16 after an overnight Israeli strike in Rafah, southern Gaza Strip, Friday, May 3, 2024. An Israeli strike on the city of Rafah on the southern edge of the Gaza Strip killed several people, including children, hospital officials said Friday. (AP Photo/Ismael Abu Dayyah)
The Chahine family prepares to bury two adults and five boys and girls under the age of 16 after an overnight Israeli strike in Rafah, southern Gaza Strip, Friday, May 3, 2024. An Israeli strike on the city of Rafah on the southern edge of the Gaza Strip killed several people, including children, hospital officials said Friday. (AP Photo/Ismael Abu Dayyah)
Palestinians stand in the ruins of the Chahine family home, after an overnight Israeli strike that killed at least two adults and five boys and girls under the age of 16 in Rafah, southern Gaza Strip, Friday, May 3, 2024. An Israeli strike on the city of Rafah on the southern edge of the Gaza Strip killed several people, including children, hospital officials said Friday. (AP Photo/Ismael Abu Dayyah)
Palestinian medics treat a wounded person as the other one carries a young wounded in the Israeli bombardment of the Gaza Strip at the Kuwaiti Hospital in Rafah refugee camp, southern Gaza Strip, early Friday, May 3, 2024. (AP Photo/Ismael Abu Dayyah)
Palestinian civil defence members evacuate survivors of the Israeli bombardment on a residential building of Abu Alenan family in Rafah, southern Gaza Strip, early Saturday, May 4, 2024. (AP Photo/Ismael Abu Dayyah)
Palestinian medics evacuate wounded children in Israeli bombardment of the Gaza Strip by ambulance to the Hospital in Rafah, southern Gaza Strip, early Saturday, May 4, 2024. (AP Photo/Ismael Abu Dayyah)
Palestinian civil defence members evacuate survivors of the Israeli bombardment on a residential building of Abu Alenan family in Rafah, southern Gaza Strip, early Saturday, May 4, 2024. (AP Photo/Ismael Abu Dayyah)
Palestinian civil defence members evacuate survivors of the Israeli bombardment on a residential building of Abu Alenan family in Rafah, southern Gaza Strip, early Saturday, May 4, 2024. (AP Photo/Ismael Abu Dayyah)
