polarized metawhich owns Facebook, Instagram and WhatsApp services, again users and investors, but it came out weak from 2022, the first year during which its advertising revenues declined since the giant social network entered the stock market in 2012. The network’s annual turnover decreased by 1% to record $116.61 billion, according to a statement of its results. .
However, the company’s share price rose 19% during electronic exchanges after the stock market closed on Wednesday, because the market was expecting a stronger decline for the American group, which is facing increasing turmoil in recent times, between macroeconomic pressures and growing competition to attract consumers.
In another positive indicator, Facebook, the network’s main service, reached the threshold of two billion daily active users, compared to 1.98 billion at the end of September. In total, about 3.74 billion people use at least one of the company’s services (social networks and messaging services) every month.
However, these pleasant surprises do not obscure the fact that the company has experienced better days in earlier stages. In the fourth quarter of 2022, Meta’s net profit halved, recording $4.65 billion.
The network’s revenues and profits have been affected by advertisers reducing their budget due to the economic crisis, competition with TikTok and changes in Apple’s rules, all of which are factors that reduce the ability of social networks to collect user data to sell precisely targeted ads.
Like many other companies, and its major neighbors in Silicon Valley other than Apple, Meta put together a grand social plan last fall.
And he has Under this plan, the group cut 11,000 jobsor about 13% of its total number of employees, and froze hiring until the end of March 2023.
Perhaps this will not be the end, as Meta seeks 2023 to be a “year of effectiveness” after 18 years of “rapid growth”, and believes that work will be a “more enjoyable” task for employees because they will be able to “do more things”. Meta has been causing concern in the markets for a year, when the group first lost users on Facebook.
This happened after the network changed its name and announced a new direction centered around Parallel universe of Metaversewhich is being marketed as the future of the Internet and which can be accessed especially through accessories for augmented and virtual reality.
However, “Realty Labs”, the division dedicated to developing Metaverse at Meta, deepened its losses to $ 4.3 billion during the past quarter, after losing $ 3.7 billion in the third quarter, and $ 2.6 billion in the second quarter.
Debra Ahu Williamson of Insider Intelligence said that the network’s president, Mark Zuckerberg, “must accept the hard truth that companies and consumers no longer have an appetite for virtual worlds at this moment.” And the American billionaire indicated on Wednesday that the metaverse remains a priority for the network, but it wears a less urgent character than artificial intelligence.
Artificial intelligence has made a strong comeback in the tech scene since last fall, thanks to gpt chat software which arouses great interest. The program, launched by the American start-up OpenAI in November, has the ability to craft various types of texts and informational lines of code.
Like Google, Meta has been working on what is known as generative artificial intelligence. In particular, Mark Zuckerberg hopes that this will allow it to easily create “videos, virtual characters for users (avatars) and 3D images” for different platforms.
Artificial intelligence is also at the core of the company’s efforts in the field of advertising, to encourage users to spend time on its applications and generate more revenue.
And Facebook reproduced the short and entertaining videos from TikTok, through the “Rails” clips, and is currently focusing on the personal recommendation algorithms that contributed strongly to the success of the competing network.
It must also find a way to increase the monetization potential of these clips, because interest in Brills now translates into a “decline in revenue,” according to the head of the network, as users spend less time on the central pages of Facebook and Instagram, which are more profitable.
The algorithms are also supposed to help Meta overcome the problem raised a year ago, due to Apple’s privacy protection policy. AI enables optimization of targeting and effectiveness measures, without collecting additional data. Insider Intelligence expects Mita shares in global markets to decline to less than 20% this year, after reaching 22% in 2021.