Meta’s Q3 2023 earnings report showed strong performance with a doubling of profits. The company’s “year of efficiency” strategy appeared to be effective, leading to a 23% year-on-year growth in revenue. Despite a 7% increase in costs and expenses, Meta’s net income surged by 164%. This increase in net income was partly attributed to the significant layoffs that began in 2022, reducing the headcount by 24% year-on-year to 66,186 employees as of September 30, 2023. It’s worth noting that a substantial majority of the impacted employees were no longer included in the reported headcount.
While Meta indicated that it had largely completed planned employee layoffs, it continued to assess its facilities for consolidation and data center restructuring. The Chief Financial Officer, Susan Li, projected that the company’s full-year expenses for the end of 2023 would fall in the range of $87 to $89 billion, a revision from the previous estimate of $88 to $91 billion. This estimate includes $3.5 billion in restructuring costs, facilities consolidation charges, severance, and other personnel expenses.
In terms of user metrics, daily active users (DAUs) increased by 5% year-on-year to 2.09 billion, while monthly active users (MAUs) rose by 3% to 3.05 billion. Ad impressions across Meta’s family of apps saw a substantial 31% year-on-year increase, even as the average price per ad decreased by 6% year-on-year. CEO Mark Zuckerberg also noted during the investor call that the company observed a 7% increase in time spent on Facebook and a 6% increase on Instagram due to improvements in its recommendation algorithm.
Despite these positive results, the company’s shares faced uncertainty in the future, particularly due to comments from the CFO regarding potential “ad softness” in light of the ongoing Israel-Hamas conflict, which led to a slide in share prices after extended trading.
