Meta Platforms, the parent company of Facebook and Instagram, has surpassed expectations for its third-quarter revenue

Advertisers looking to capitalise on resilient consumer spending have flocked to Meta’s digital platforms, driving robust financial results.

The company also made adjustments to its expense forecast for the year, but it cautiously warned of forthcoming spending increases and regulatory pressures in 2024. For 2023, Meta now anticipates total expenses ranging between $87 billion and $89 billion, a slight reduction from its earlier projection of $88 billion to $91 billion.

Looking ahead to 2024, the social media giant predicts total expenses in the range of $94 billion to $99 billion, which is higher than initial estimates, as per data from the London Stock Exchange Group (LSEG). However, Meta refrained from providing additional details about 2024 expenditures, citing factors like increased infrastructure investments, hiring plans, and expected losses in its metaverse-focused Reality Labs unit, much like the previous quarter.

“The anticipated global surge in digital ad spending, poised to hit $667.6 billion next year, combined with Meta’s effective execution and cost control, puts the company on strong footing,” noted Jeremy Goldman, principal analyst at Insider Intelligence.

In response to this positive news, Meta’s shares surged by 4% in extended trading, reflecting renewed investor confidence in the company. After a challenging 2022, Meta has experienced a resurgence, driven by growing interest in emerging artificial intelligence technology, a revival in digital advertising, and an aggressive cost-cutting strategy that saw approximately 21,000 employees let go since the previous autumn.

The company’s shares have rallied significantly, with a nearly 150% increase in value so far this year.

In terms of financial performance, Meta reported a 23% increase in revenue, reaching $34.15 billion for the third quarter ending in September. Analysts had expected revenue to reach $33.56 billion, based on LSEG data. The company also exceeded profit expectations.

Key metrics, such as Meta’s daily active people (DAP), experienced a 7% growth. DAP is a metric used to track unique users who engage with any of Meta’s apps, including Facebook, Instagram, Messenger, or WhatsApp within a single day. This growth follows a 7% increase reported in the preceding June quarter.

Specifically for Facebook, daily active users saw a 5% uptick, while ad impressions across Meta’s suite of apps expanded by an impressive 31%.

Meta’s strong performance in Q3 2023 showcases its ability to attract advertisers and maintain user engagement, setting a positive tone for the upcoming holiday season. Nevertheless, the company remains cautious about the challenges it may face in the year ahead.