Meta Platforms Inc. reported $32.17 billion in revenue during the fourth quarter, falling within the company’s forecasts and higher than the consensus on Wall Street but representing a 4 percent year-over-year decline.
Net income also saw a 55 percent year-over-year decline at $4.65 billion for the quarter, and the company said it took a $4.2 billion hit in restructuring costs that resulted in the layoffs of 13 percent of Meta’s workforce, or roughly 11,000 employees. The company’s total head count as of Dec. 31 was 86,482, but that figure still includes a “substantial majority” of the employees who were laid off, Meta said in its earnings release.
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Of those restructuring costs, $1.88 billion was the result of Meta’s decision to downsize its offices by either terminating agreements early, abandoning office buildings under operating leases or subleasing those facilities. Severance and personnel costs accounted for $975 million of the total $4.2 billion figure.
Despite the financial declines, Meta stock rose in after-hours trading by roughly 18 percent after the company reported earnings, perhaps buoyed by Meta’s continued growth for its flagship site Facebook, which hit 2 billion daily active users during the month of December, and a 23 percent yearly increase in ad impressions for its family of apps — which includes Instagram and Facebook — during the fourth quarter.
But as Meta continues with its expensive AR expansion, known as Reality Labs, the segment is continuing to make a dent on the company’s net income. During the fourth quarter, Reality Labs was responsible for $4.28 billion in losses, while the total year impact was $13.72 billion — up from $10.19 billion in losses in 2021.
First-quarter revenue is forecasted to be between $26 billion to $28.5 billion. The company also lowered its guidance for its 2023 expenses from upward of $100 billion to $95 billion. Included in that figure is an estimated $1 billion in restructuring costs related to downsizing the company’s offices.
“Our management theme for 2023 is the ‘Year of Efficiency’ and we’re focused on becoming a stronger and more nimble organization,” Meta CEO Mark Zuckerberg said in announcing the results.
