Neil Cybart 8/23/24 Neil Cybart 8/23/24

Meta 2Q24 Earnings, Thoughts on Meta HW Sales

We will continue our 2Q24 earnings reviews with Meta. Within Big Tech, Meta may be the most interesting from a competitive standpoint relative to Apple. Let’s jump in.

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Neil Cybart 4/26/24 Neil Cybart 4/26/24

Meta 1Q24 Earnings, About Meta’s “AI-Recommendation” System, Meta’s HW Sales

Hello everyone. Today's update will be dedicated to discussing Meta's earnings. Let's jump right in.

Meta 1Q24 Earnings

Meta’s 1Q24 earnings release was a tale of the conference call. Actual results found in the release were what we have come to expect from the company. Meta’s advertising machine found its feet in 2023 after a shaky period involving macro headwinds and renewed competitive pressure. Revenue was up 27% with operating income up 91%.

While we can take issue with some of the inner workings of that advertising machine when it comes to AI - which we will discuss shortly – there is no debate that Meta's monetization struggles of 2022 and early 2023 have dissipated.

Management's 2Q24 guidance is pointing

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Neil Cybart 2/12/24 Neil Cybart 2/12/24

Meta 4Q23 Earnings, Estimating Meta Quest 3 Sales, Ray-Ban Meta and AI

There are several Big Tech earnings reports for CY4Q23 worth going over. For those of you who recently became Above Avalon members, my approach to covering Big Tech earnings is twofold:

Assess how Apple competitors are doing from a financial/business perspective. This will involve looking at revenue growth metrics, cash flow generation, etc. Given major differences in business models, the metrics will need to be put into proper prospective.
Look for developments that shine light on competitive dynamics that stand to impact Apple. This may include everything from advertising to hardware.

Today’s update will be dedicated to Meta, a company that is turning into one of Apple’s most direct competitors.

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Neil Cybart 11/15/23 Neil Cybart 11/15/23

Meta 3Q23 Earnings, Meta Hints at Sluggish Quest 3 Sales

Hello everyone. Meta reported earnings back on October 25th, a few weeks after the company’s Connect conference (discussed in greater detail here). When looking at the competitive landscape, Meta has become one of Apple’s top competitors. Accordingly, we continue to fully cover the company’s business performance and strategy. Let’s jump right in.

Meta 3Q23 Earnings

Meta’s reported 3Q23 numbers were strong.

23% revenue growth
143% operating income growth
168% EPS growth

Much of this strength was expected. Revenue exceeded the midpoint of management’s guidance by just 3%, boosted by a FX tailwind.

Meta continues to see stabilization in its core business of monetizing user attention via advertising. This is the third consecutive quarter that showed such stabilization. A very easy year-over-year compare is certainly helping Meta. The company had a tough 2022. The stronger dollar is helping as well. However, there is legitimate improvement found within Meta’s core business, such as better Reels monetization.

In what is still difficult to get one’s mind around, Meta’s employee count at quarter end was down 24% year-over-year. This is obviously helping to cut expense growth and boost operating margins.

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Neil Cybart 7/28/23 Neil Cybart 7/28/23

Meta 2Q23 Earnings, Reality Labs Losses, Meta Stock

Happy Thursday. We will continue our earnings reviews with Meta. The discussion includes Neil’s thoughts on Meta’s 2Q23 results, the significant loses associated with Reality Labs (AR/VR), and Meta’s stock rollercoaster. Apple reports earnings a week from today – Thursday, August 3rd.

Meta 2Q23 Earnings

Meta’s core business of monetizing user attention via advertising continues to stabilize. We saw the early stages of this improvement in Meta’s last earnings release three months ago.

Management provided a few factors behind the continued improvement in 2Q23:

An easier year-over-year compare. 2022 saw weakened results. 2Q marked a full quarter without Russia revenue.
Improved Reels monetization.
Increased ad supply.
FX turning from a revenue growth headwind to tailwind. (This is something to note with Apple’s earnings next week.)

There is a simpler explanation at play for the continued stabilization: Thanks to Reels, Meta’s TikTok copycat, Meta is holding its own on the engagement front against TikTok. Not only is Reels keeping users on Facebook and Instagram, but it appears to be successfully adding new people into the Meta fold.

Key Meta data points from the quarter:

3.9B people use at least one Meta property on a monthly basis.
3.1B people use at least one Meta property on a daily basis in June.

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Neil Cybart 11/2/22 Neil Cybart 11/2/22

Meta 3Q22 Earnings, Meta’s Fragile Bridge, The Big (Meta) Picture (Daily Update)

In today's update, we will go over Meta’s CY3Q22 results which ended being just as much about industry developments as it did Meta’s performance. In particular, we go over Neil’s thoughts on two problems found with Mark Zuckerberg’s plan on funding future bets and the ultimate bet Zuckerberg is making here.

Happy Wednesday.

Late last week, Apple released its 2022 10-K (58 pages). The tentative plan is to go through the key takeaways from the financial filing tomorrow.

In today's update, we will go over Meta’s CY3Q22 results which ended being just as much about industry developments as it did Meta’s performance.

Let’s jump right in.

Meta 3Q22 Earnings

Last Wednesday, Meta reported 3Q22 earnings.

Here is an earnings recap table comparing Meta's numbers to those of Apple and Alphabet:

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