Meta has published a report showing its financial results for the second quarter of 2024 surpassed analysts’ estimates. The company’s revenue, income, and forecast for the current quarter were higher than expected.
Meta’s revenue in Q2 2024 reached $39.07 billion, exceeding analysts’ expectations of $38.31 billion. This represents a 22% year-on-year growth, marking the fourth consecutive quarter with revenue growth exceeding 20%. The company’s profit amounted to $13.47 billion or $5.16 per share, significantly outperforming analysts’ predictions of $4.73 per share. This translates to a 73% growth compared to the second quarter of last year when Meta’s profit was $7.79 billion or $2.98 per share.
The company’s Q3 revenue guidance ranges from $38.5 billion to $41 billion (averaging $39.75 billion), surpassing analysts’ expectations of $39.1 billion. We’ll keep you updated on how these projections align with actual results in the coming months.
Continued Growth and Strategic Investments
Meta’s positive results indicate its growing share in the digital advertising market, the company’s core business. Advertising revenue, primarily from Facebook and Instagram, grew 22% year-over-year. This growth outpaces competitors, with Alphabet recently reporting an 11% increase in Google ad sales, while YouTube missed analysts’ expectations.
The social media giant continues to implement a cost-cutting program announced in late 2022, having eliminated about 21,000 jobs in several rounds of layoffs. Despite these measures, Meta’s operating income grew 58% year-over-year to $14.9 billion, with operating margins improving to 38% from 29% in the same period last year.
Meta remains committed to investing heavily in cutting-edge technologies like AI and VR, which are essential to building the metaverse. The company is increasing its investment in data centers and computing power to stay competitive. By the end of the year, Meta will have 350,000 Nvidia H100 advanced AI accelerators, or 600,000 if other models and manufacturers are used by analogy, according to CEO Mark Zuckerberg. NIX Solutions reminds that the company recently unveiled a major update to its large language models, Llama 3.1, with the most powerful version boasting 405 billion parameters.
Meta’s Q2 expenses totaled $24.2 billion, including a $1.4 billion settlement of a Texas case over unauthorized use of facial recognition data. Capital expenditures for the second quarter were $8.47 billion, below analysts’ expectations of $9.51 billion. The company raised its 2024 capital expenditure guidance to a range of $37 billion to $40 billion, up from the previous $35 billion. Capital expenditures are expected to increase significantly in 2025 as Meta continues to invest in research and product development.
Meta shares have gained 34% year-to-date, with an additional 6.9% increase following the publication of this report.