Facebook / Meta Caught Up In Googles After Hours Drop

٢٦ أكتوبر ٢٠٢٢

Google dropped a bit over 7% in the market after hours after reporting poorer than expected earnings.

Facebook is due to report today but is already down by 4% or so on speculation they will suffer a similar performance drop as well.

Both are pretty big tech heavyweights that should give the overall Nasdaq some grief today.

٢٧ أكتوبر ٢٠٢٢

ملاحظة

Crazy. After a fools rally its dropped almost 27% in the after market. Ouch !!

Im thinking oversold BUT prices can always go lower... Anyone game enough to buy :)

٢٧ أكتوبر ٢٠٢٢

ملاحظة

Update from the Zuck via FB - Part 1

Mark Zuckerberg
4 h
·
3.7 billion people now use one of Meta's apps monthly. The number of people using Facebook each day is the highest it's ever been. Instagram has more than 2 billion monthly actives. WhatsApp has more than 2 billion daily actives. We're also seeing strong momentum in Reels with 140 billion plays across our services each day. Overall, our product trends look better than some of the recent commentary I've seen.
Here are my full comments from the earnings call today:
---
Our community continued to grow this quarter. We now reach more than 3.7 billion people monthly across our family of apps. And while we continue to navigate some challenging dynamics -- a volatile macroeconomy, increasing competition, ads signal loss, and growing costs from our long term investments -- I have to say that our product trends look better from what I see than some of the commentary I've seen suggests.
There has been a bunch of speculation about engagement on our apps and what we're seeing is more positive. On Facebook specifically, the number of people using the service each day is the highest it's ever been -- nearly 2 billion -- and engagement trends are strong. Instagram has more than 2 billion monthly actives. WhatsApp has more than 2 billion daily actives, also with the exciting trend that North America is now our fastest growing region. Across the family, some apps may be saturated in some countries or some demographics, but overall our apps continue to grow from a large base. We're also seeing engagement grow -- especially strong growth in Reels -- and I'll share more details around that when I discuss our product priorities shortly.
In terms of our business, total revenue grew slightly this quarter on a constant currency basis. We're still behind where I think we should be, but we believe that we will return to healthier revenue growth trends next year. That said, it's not clear that the economy has stabilized yet so we're planning our budget somewhat more conservatively.
In 2023, we're going to focus our investments on a small number of high priority growth areas. So that means some teams will grow meaningfully, but most other teams will stay flat or shrink over the next year. In aggregate, we expect to end 2023 as either roughly the same size, or even a slightly smaller organization than we are today.
Three of the primary areas we're going to focus on are our AI discovery engine that's powering Reels and other recommendation experiences, our ads and business messaging platforms, and our future vision for the metaverse. The internal indications I've seen suggest we're doing leading work and are on the right track with these investments, so I think we should keep investing heavily in these areas.

٢٧ أكتوبر ٢٠٢٢

ملاحظة

Part 2

As I've shared before, our goal is to grow Family of Apps operating income, such that even with our AI infrastructure and Reality Labs investments, we can still meaningfully grow our overall company operating income in the long term. Our current surge in capex is largely due to building out our AI infrastructure and we would expect capex to come down as a percent of our revenue over the long term. We expect Reality Labs expenses will increase meaningfully again in 2023, with the biggest drivers of that being the launch of the next generation of our consumer Quest headset and hiring that's been done in 2022 but for which we'll be paying the first full year of salaries next year. More broadly, beyond 2023, we expect to pace Reality Labs investments to ensure that we can achieve our goal of growing overall company operating income. Our capital allocation philosophy over the long term is to allocate a portion of the profits generated from the Family of Apps towards these future focused areas while enabling greater return of capital to shareholders.
Alright, now, I'd like to share some updates on the progress we're seeing in these product areas.
Our AI discovery engine is playing an increasingly important role across our products -- especially as advances enable us to recommend more interesting content from across our networks in feeds that used to be primarily driven just by the people and accounts you follow.
This of course includes Reels, which continues to grow quickly across our apps -- both in production and consumption. There are now more than 140 billion Reels plays across Facebook and Instagram each day. That's a 50% increase from six months ago. Reels is incremental to time spent on our apps. The trends look good here, and we believe that we're gaining time spent share on competitors like TikTok.
Over time, I expect a few things to set our products apart. First is that our discovery engine work allows us to recommend all types of content beyond Reels as well, including photos, text, links, communities, short and long-form videos, and more. Second is that we can mix this content alongside posts from your family and friends, which can't be generated by AI alone. Third, as more social interactions move to messaging, we're developing a flywheel between discovery and messaging that are going to make these apps stronger. On Instagram alone, people already reshare Reels 1 billion times a day through DMs.
Moving to monetization, I've discussed in the past how the growth of short-form video creates near-term challenges since Reels doesn't monetize at the rate of feed or stories yet. That means as Reels grows, we're displacing revenue from higher-monetizing surfaces. I think this is clearly the right thing to do so Reels can grow with the demand we're seeing, but closing this gap is also a high priority. Even with the progress we've made, we're still choosing to take a more than $500 million quarterly revenue headwind with this shift. But we expect to get to a more neutral place over the next 12-18 months. I mentioned last quarter that Instagram Reels had crossed $1 billion annual revenue run rate. We continue scaling monetization across both Instagram and Facebook, and the combined run rate across these apps is now $3 billion.
Beyond Reels, messaging is another major monetization opportunity. Billions of people and millions of businesses use WhatsApp and Messenger every day, and we're confident we can connect them in ways that create valuable experiences.
We started with Click-to-Messaging ads, which let businesses run ads on Facebook and Instagram that start a thread on Messenger, WhatsApp or Instagram Direct so they can communicate with customers directly. This is one of our fastest growing ads products, with a $9 billion annual run rate. This revenue is mostly on Click-to-Messenger today since we started there first, but Click-to-WhatsApp just passed a $1.5 billion run rate, growing more than 80% year-over-year.
Paid messaging is another opportunity we're starting to tap into, and it continues to grow quickly but from a smaller base. We're putting the foundation in place now to scale this with key partnerships like Salesforce, which lets all businesses on their platform use WhatsApp as the main messaging service to answer customer questions, send updates, and sell directly in chat. We also launched JioMart on WhatsApp in India and it's our first end-to-end shopping experience that shows the potential for chat-based commerce through messaging.
Between Click-to-Messaging and paid messaging, I'm confident this is going to be a big opportunity.
The last area I want to discuss today is the metaverse.
We just had our Connect conference and announced Quest Pro, which we just started shipping. It's our new high-end VR headset that delivers high-resolution mixed reality so you can blend virtual objects into the physical environment around you. It's pretty amazing when you see it, and it's going to enable all kinds of new experiences in socializing, gaming, fitness, and work. I'm really looking forward to seeing what people build with this new capability.
Work in the metaverse is a big theme for Quest Pro. There are 200 million people who get new PCs every year, mostly for work. Our goal for the Quest Pro line over the next several years is to enable more and more of these people to get their work done in virtual and mixed reality, eventually even better than they could on PCs.
To deliver a great work and productivity experience, I'm excited about the partnerships that we announced with Microsoft bringing their suite of productivity and enterprise management services to Quest, Adobe and Autodesk bringing their creative tools, Zoom bringing their communication platform, Accenture building solutions for enterprises, and more.
There's still a long road ahead to build the next computing platform, but we are clearly doing leading work here. This is a massive undertaking and it'll often take a few versions of each product before they become mainstream. But I think our work is going to be of historic importance and create the foundation for an entirely new way that we will interact with each other and blend technology into our lives, as well as a foundation for the long term of our business.
So between the AI discovery engine, our ads and business messaging platforms, and our future vision for the metaverse, those are three of the areas we're focused on. I believe the tougher prioritization, discipline, and efficiency we're driving across the organization will help us navigate the current environment and emerge an even stronger company. As always, I'm grateful to everyone at Meta for your hard work, and to all of you for being on this journey with us.