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.
What will it take for the Fed to cut rates?
Leading economists anticipate a potential shift in the Federal Reserve’s monetary policy, shedding light on the timeline for an interest rate reduction.
Financial experts and analysts have closely examined economic indicators, which suggest that a change in the Fed’s stance may be on the horizon. Factors such as inflationary pressures, employment rates, and GDP growth have all been scrutinized to ascertain when the central bank might decide to cut interest rates.
The consensus among these experts is that a rate cut could occur within the next six to nine months. They point to the Federal Reserve’s commitment to maintaining a flexible approach, adjusting policies as needed to support economic stability. With inflationary concerns still looming and the labor market showing signs of recovery, the timing of a potential rate cut remains a key topic of discussion among financial circles.
The Federal Reserve’s decision on interest rates can have a profound impact on financial markets, investments, and borrowing costs. As such, investors and businesses are keeping a keen eye on developments in this regard, preparing for potential changes in their financial strategies.
Kyle Rodda from Capital.com spoke with Ticker’s Ahron Young. #featured
Bank accidentally deposits $86M into client’s account
A financial institution mistakenly deposited over $86 million into a client’s account, causing shockwaves in the banking industry.
The error came to light when the client, a small business owner, checked their account balance and discovered the astronomical sum. It is being hailed as one of the most significant banking errors in recent memory.
The client, who wishes to remain anonymous, reportedly contacted the bank immediately upon noticing the massive windfall. Bank officials were left scrambling to rectify the error, which has raised numerous questions about the institution’s internal controls and safeguards.
The client’s account, initially holding just a few thousand dollars, suddenly displayed a balance that could buy luxury yachts, mansions, and more.
The incident has prompted investigations by regulatory authorities to determine how such an egregious error occurred in the first place.
While the bank has issued an apology and assured the client that the funds will be corrected to the proper balance, it remains unclear how this mistake could have happened on such a colossal scale.
The financial institution may also face potential legal consequences for the error, as well as reputational damage that could impact its future business.
Tech giants drive global mega-cap surge amid inflation relief
Tech giants have taken the lead in propelling global mega-cap stocks to new heights.
This surge comes as a welcome relief for investors who have been closely monitoring the impact of rising inflation on the financial markets.
The tech sector, including giants like Apple, Amazon, and Microsoft, has been instrumental in driving the rally. These companies have reported robust earnings and strong growth prospects, which has boosted investor confidence. As a result, the market capitalization of these tech behemoths has reached unprecedented levels, contributing significantly to the overall rise in global mega-cap stocks.
The easing of inflationary pressures has played a pivotal role in this resurgence. Central banks’ efforts to tame inflation through monetary policy adjustments have begun to bear fruit, reassuring investors and stabilizing financial markets. As concerns over rapidly increasing prices recede, investors have become more willing to invest in mega-cap stocks, particularly in the tech sector, which has demonstrated resilience in the face of economic challenges.
Will the tech giants maintain their momentum and continue to lead the mega-cap surge, or are there potential risks on the horizon?
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