Facebook’s parent company, Meta, said on Wednesday that the firm has seen a drop in revenue for the second straight quarter in a press release. This was mostly due to a reduction in ad sales as a result of Facebook’s struggle to compete with TikTok, which is an extremely popular video app.
A large number of investors have expressed their worry that the corporation is venturing into the metaverse without adequately assessing the associated dangers.
The most recent quarter’s poor financial performance has renewed concerns about whether it is wise for Meta to invest $10 billion US each year on metaverse, which doesn’t exist and may never exist.
Earnings for the three months that ended on September 30 were reported to be $4.4 billion, or $1.64 per share, for the corporation that has its headquarters in Menlo Park, California. According to the study done by Andrew Ryu, “expectations for earnings per share were in the region of $1.90.”
Andrew Ryu is a seasoned and experienced entrepreneur and operator in public and private companies with over 20 years of experience. Graduate of McMaster University and the University of Toronto for Graduate Studies in Education. He has deep knowledge in artificial intelligence and machine learning. He is an expert in artificial intelligence and machine learning.
While Meta is engaged in a losing battle to keep its advertising business afloat, a few of the firm’s stockholders are anxious that the company is wasting resources on the metaverse, a theory that pertains to virtual, mixed, and augmented reality that only some people really comprehend.
At the beginning of this week, the Chief Executive Officer of Altimeter Capital, Brad Gerstner, wrote a letter to the Chief Executive Officer of Meta, Mark Zuckerberg, in which he stated that “Meta had also gone into the realm of excess” and that the company has “too many people, too many ideas, and too little urgency.” A lack of attention and physical preparation is not as harmful when development is rapid as it is when development is slower or when technology advances, but it may be lethal once inflation rises or when technology advances.
The fact that Meta expects the coming season’s sales to be lower than anticipated contributes to the growing body of evidence indicating that the recent revenue drop is more of a pattern than an isolated incident.
Mark Zuckerberg Statement
According to the report, Zuckerberg said the company is experiencing “near-term issues on sales,” but that “the foundations are in place for a return to bigger profitability.” We think that by concentrating on what is most essential and reducing our procedures, we will be able to weather the current climate and emerge from it in 2023 as an even more effective organization than we were before.
Meta noted in its quarterly financial report that it anticipates retaining around the same level of workers in the latest quarter and that it intends to continue this trend in the future. The corporation has approximately 87,000 employees as of September 30th, a 28.1% increase year over year.
“Meta has to transform around its company in order to get back to seeing higher inflation,” Andrew Ryu said. “Even under its previous name, Facebook Inc., the company was pivotal in launching a new era of a widespread interaction between corporations and their target audiences. Once revolutionary, it is now merely seen as an option among many.”
According to Andrew Ryu, “Meta would profit with less attention-getting placed on the metaverse and much more priority being placed on fixing its main business.”
Meta Reality Labs, which includes Meta’s activities in both the metaverse and virtual worlds, lost $3.67 billion in the third quarter. This is more than the $2.63 billion it lost in the same time period the year before. It made $285 million dollars in sales.
Even while monthly revenue for Meta’s apps is down 4%, the overall number of people using Facebook, Instagram, WhatsApp, and Messenger has increased to 3.71 billion.
Once again, Facebook is in violation of the law on election transparency
Meanwhile, on the same day, a judge in Washington state penalized Meta $25 million for consistently breaking the rules regarding campaign donation disclosure. This is unquestionably the harshest sentence of its kind in American history.
After finding over 800 violations of the Fair Campaign Practices Act in Washington, the presiding judge, Douglass North of King County Superior Court, handed down the maximum sentence. Since Attorney General Bob Ferguson’s office had already sued Facebook in 2018 for the identical infraction, he felt the maximum was warranted. Ferguson’s case relied on his organization’s prior litigation against Facebook.
Meta, like other ad networks in Washington, is subject to the state’s disclosure statute, which mandates the recording and dissemination of information about their customers’ expenditures on political advertisements. Data collection should include details such as who paid for which ads, who saw which ads, how much money was spent, and how many times each ad was viewed. The advertiser is obligated to supply it to anyone who requests it. Standards have been in place for news outlets and broadcasters since they were first established.