Meta Platforms, Inc. ($FB) Earnings (Q1 FY22)

 Meta Platforms, Inc. ($FB) Earnings and Opinion:


Meta Platforms is a company in the Communication Services sector and operates in the Internet Content and Information industry. The company develops products to offer services for people to connect with others on social media platforms. Meta Platforms just recently changed its name to Facebook and is currently headquartered in Menlo Park, California. The company was first traded on the stock market in 2012. 

Meta Platforms EPS and Revenue (Q1 FY22):

  • EPS of $2.72 beating expectations of $2.51
  • Revenue of $27.91B missing expectations of $28.22B
Meta Platforms Q1 Highlights:
  • Revenue was up 7% (YOY)
  • Expenses and costs was up 31% (YOY)
  • Net income of $7.5B, down 21% (YOY)
  • EPS was down 18% (YOY)
Opinion:
Meta Platforms rose after reporting its first quarter in the new fiscal years results. The company posted a solid beat on its EPS expectations, but missed on the revenue expectations Wall Street had for them. That doesn't take away from the fact that the revenue was up 7% on a year-over-year basis. Investors saw the bright side in this earnings report, even though I don't see it as much as they do. I bet a lot of the positive sentiment arising after the earnings report was due to the direction the leaders of the company gave for this company. A lot of talk was about the revitalization of bigger growth rates. For me personally, I think the company is trading at some solid valuations that we haven't seen in a while. Although I have never been a big fan of this company, the start of the metaverse and a move to Web3 could keep Meta atop of this industry. I really don't like the fact that the expenses grew at a 31% rate while the revenues only gained 7%. This could be due to the fact that R&D expenses were up a little bit. I can see this company pouring a lot of money to be successful in Web3, so that's why I see a lot of expenses growing. I am personally going to stay out of this one right now. I think the company could be a great investment for the long-term. I think the business model is quite complicated and they rely too much on factors that are uncontrollable in their sense. I want to see if these increase in expenses will eventually pay off and see if they can get back to some solid growth rates like they had at the birth of their company days.

*Information from Meta Platforms, Yahoo Finance, Google
*Estimates from Zacks 

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