What’s Going On Here?Meta reported a mixed set of quarterly results late on Wednesday, even as the tech giant tries to bring new meaning to the phrase “online shopping”. What Does This Mean?Meta’s last earnings update was a disaster: the company’s stock price collapsed 25% after Facebook posted a drop-off in active users, triggering the biggest one-day valuation drop in US history. But the scrappy underdog has picked itself back up again, posting 6% more monthly active users across all its platforms than the same time last year. Its Reality Labs segment – which specializes in VR and the metaverse – performed well too, with revenue up 30%. And sure, Meta’s ad revenue missed expectations, probably partly because it decided to focus on formats like Reels – a short-form video that tends to earn less ad revenue than Feed and Stories. Still, more users is more ad revenue up for grabs, and Meta’s shares initially jumped 19%. Why Should I Care?The bigger picture: Your body is holding you back.
There’s a lot resting on the success of the metaverse for Meta, but the company has some work to do on that front: its metaverse brand Horizon Worlds only has 300,000 users to Facebook’s 3 billion-odd. So to get the word out, the company announced this week that it’ll be opening its first-ever retail store in California next month. It’ll use the store to showcase its virtual reality headsets and other hardware, in hopes of convincing you to abandon your feeble corporeal form once and for all.
Zooming out: Snap vs. TikTok.
Meta’s not the only one with advertising problems: Snap reported worse-than-expected results last week, as rising inflation took its toll on companies’ marketing budgets. That’s the last thing it needed after Apple rolled out new privacy settings that have made it harder for companies to target their campaigns to the right prospects. Throw in stiff competition from Gen Z-favorite TikTok, and its outlook for this quarter missed expectations too. | 