Meta has come out firing this quarter with a quarterly profit of $11.6 billion USD.
👉 Background: Meta and its group of apps have grown into an absolute tech behemoth over the past 19 years. In fact, Instagram, Facebook, Whatasapp has more than 3 billion daily users worldwide.
👉 What happened: After stripping back its investment in the metaverse, Meta has come out firing this quarter with a quarterly profit of $11.6 billion USD...which had more than doubled over the past year.
👉 What else: But, Meta’s CFO warned that the “revenue outlook is uncertain for 2024”. That’s because Meta’s business is heavily dependent on the macroeconomic environment for spending.
💡When you're heavily dependent on one revenue stream, the broader economy can either be your best friend or your worst enemy.
💡Despite a tough economy, its ad sales jumped 24% year on year. That’s because Meta has been squeezing 31% more ads into its services - thanks to the rise of features like Reels.
💡But Meta generates more than 95% of its revenue from advertising. And that means, if the economy slows down, then businesses slow down their ad campaigns. So even the largest tech companies aren't immune to the winds of economy.
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