![]() Slower Facebook growthīy comparison, Facebook had a massive base of 1.98 billion active daily users on average for September - a 3% increase from a year ago. "nvestors should remain on the sidelines as it will take many years before progress in the metaverse can be truly monetized," Angelo Zino, senior equity analyst CFRA Research, told investors in a research note. Horizon Worlds, Meta's new virtual space, trimmed its goal for monthly active users to 280,000 from 500,000, but the space is attracting fewer than 200,000, the Wall Street Journal reported earlier this month. On October 28, 2021, the parent company of Facebook changed its name from Facebook, Inc., to Meta Platforms, Inc., to reflect its focus on building the. ![]() Unlike the longer time-lines for building businesses common in Silicon Valley, Wall Street values companies based on near-term returns rather than hazier projections that stretch years into the future. Investors are skeptical because, at least so far, consumers aren't exactly flocking to the fledgling metaverse. It expects the unit to have "significantly" wider operating losses in 2023, the company said on Wednesday. For the first nine months of the year, Meta lost $9.4 billion on its metaverse unit, Reality Labs. The company is making what amounts to a wildly expensive bet on its ability to transform into a virtual reality behemoth and whether that technology can power the next phase in Meta's growth.Īlthough such strategic pivots can take years for big companies to execute - as it did for IBM and Microsoft as they morphed from selling hardware to software - the early returns for Meta have been grim. Zuckerberg also didn't mention the metaverse among his top priorities for the companies this year, Munster added – and that's a good sign for investors.On a Wednesday conference call to discuss Meta's latest earnings, Zuckerberg told investors he is "pretty confident this is going in a good direction." The Meta CEO promised investors a "year of efficiency," and said the firm would direct its focus towards its artificial intelligence initiatives as well as improving some of its key platforms, like Reels and Messenger. Zuckerberg warned employees to buckle up for an intense. The company also missed its earnings targets last year partly due to Zuckerberg's investments in the metaverse, a lofty project that burned through $13.72 billion and angered many of Meta's investors.īut Zuckerberg shifted his tone in Meta's latest earnings call, Munster noted. In May, Mark Zuckerberg, Meta’s chief executive, froze hiring for engineers and low-level data scientists. The holding company even adopted the infinity loop as its new logo. Zuckerberg said the companys AI-discovery engine had helped plays of Reels, its short-form video rival to TikTok, double in just the last six months.Were making progress here, and our monetization efficiency on Facebook has doubled in the past six moths, he added. That comes after a dismal year for the Facebook parent, which saw shares plunge 64% in 2022 amid rising inflation and higher interest rates. It was in October last year when Facebook was rebranded into Meta as an effort to focus on its ambitions of building the metaverse. Shares rose to $182.35 at 10:00 am ET, up 19% from Wednesday's close. Though Munster previously predicted an " ugly" fourth quarter for Meta, the company's stock soared on Thursday morning after it announced it would be buying back $40 billion in shares and start slashing costs. Meta stock could pop as much as 30% as Mark Zuckerberg appears to finally be waking up to investors' tepid response to his metaverse ambitions and focusing the company on other initiatives, Deepwater Asset Management partner Gene Munster said Thursday.
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