{"id":76828,"date":"2023-10-25T21:29:03","date_gmt":"2023-10-26T01:29:03","guid":{"rendered":"https:\/\/ifintechworld.com\/investing\/facebook-says-middle-east-war-is-hurting-ad-spending\/"},"modified":"2023-10-25T21:29:09","modified_gmt":"2023-10-26T01:29:09","slug":"facebook-says-middle-east-war-is-hurting-ad-spending","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=76828","title":{"rendered":"Facebook says Middle East war is hurting ad spending"},"content":{"rendered":"
\n

Shares of Meta Platforms Inc. were giving back their gains in Wednesday\u2019s extended session after the Facebook parent company easily topped earnings expectations but spooked Wall Street with its talk of the future.<\/p>\n

Meta
\n META,
\n -4.17%<\/bg-quote>
\n Chief Financial Officer Susan Li shared on Meta\u2019s earnings call that the company has seen softness in the advertising market following the start of the Middle East war, which has created \u201cgreater uncertainty\u201d and \u201cvolatility\u201d in the current quarter. <\/p>\n

\n

\u201cWhile we don\u2019t have material direct revenue exposure to Israel and the Middle East, we have observed softer ad spend in the beginning of the fourth quarter, correlating with the start of the conflict, which is captured in our Q4 revenue outlook,\u201d she shared.<\/p>\n

The commentary dovetailed with similar words from Snap Inc.\u2019s
\n SNAP,
\n -5.36%<\/bg-quote>
\n management a day earlier. <\/p>\n

Read: <\/strong>Snap posts surprise revenue growth, but Israel conflict is making advertisers skittish<\/p>\n

Additionally, Li declined to offer revenue guidance for fiscal year 2024, and when pressed by an analyst to offer top-line \u201cputs and takes\u201d for next year, she referred back to her prior commentary on the \u201cvolatile macro environment\u201d that Meta has already seen in the fourth quarter of this year.<\/p>\n

\u201cI think that will obviously have a big impact on the advertising market next year, and it\u2019s something we\u2019ll be keeping a very close eye on, but ultimately, we\u2019re very subject to volatility in the macro landscape,\u201d she said, according to a transcript provided by AlphaSense\/Sentieo.<\/p>\n

Meta shares, which were up about 4% shortly after the company released its results, reversed course and were off more than 2% following the earnings call. <\/p>\n

The forward-looking comments overshadowed better-than-expected performance in the third quarter. <\/p>\n

Meta rang up quarterly net income of $11.6 billion, or $4.39 a share, compared with net income of $4.4 billion, or $1.64 a share, in the year-ago quarter. Net income was up 164% from a year before. <\/p>\n

Analysts surveyed by FactSet had expected on average earnings of $3.64 a share.<\/p>\n

Revenue, meanwhile, climbed 23% to $34.2 billion from $27.7 billion in the year-ago quarter. Analysts had been looking for $33.6 billion.<\/p>\n

A rebound in advertising, the monetization of Instagram and Reels, and AI-fueled ad targeting and measurement contributed to the quarter\u2019s performance. Meta\u2019s upbeat results come on the heels of a similarly strong quarter from Google parent Alphabet Inc.\u00a0
\n GOOGL,
\n -9.51%<\/bg-quote><\/p>\n

GOOG,
\n -9.60%<\/bg-quote>,<\/span>
\n which reported earnings a day earlier.<\/p>\n

Read: <\/strong>Google\u2019s stock sheds market cap the size of Nike in one of Wall Street\u2019s five worst drops ever<\/p>\n

\u201cWe\u2019re a leaner organization, shipping faster and advancing the state of the art in all of our long-term initiatives,\u201d Chief Executive Mark Zuckerberg said on the earnings call. \u201cAnd while investing heavily for the future, we also just recorded our highest operating margin in two years, so I\u2019m looking forward to carrying this product momentum and operating discipline forward.\u201d<\/p>\n

Meta executives forecast fourth-quarter revenue of $36.5 billion to $40.0 billion, while analysts on average were expecting $38.8 billion, according to FactSet. <\/p>\n

\u201cThe anticipated global surge in digital ad spending, poised to hit $667.6 billion next year, combined with Meta\u2019s effective execution and cost control, puts the company on strong footing,\u201d Insider Intelligence analyst Jeremy Goldman said in emailed comments.<\/p>\n

The company also cut its full-year outlook for total expenses and now expects $87 billion to $89 billion. The prior forecast was for $88 billion to $91 billion. Meta now expects 2023 capital expenditures of $27 billion to $29 billion, whereas its earlier outlook was for $27 billion to $30 billion.<\/p>\n

Read:<\/strong> Nvidia and Arista see their stocks drop as Meta capex outlook trails estimates<\/p>\n

\u201cWe expect Reality Labs operating losses to increase year-over-year in 2023,\u201d the company said in its release.<\/p>\n

Meta said it reduced its worldwide workforce 24% on a year-over-year basis, as of Sept. 30, when headcount was 66,185.<\/p>\n

Facebook had 3.14 billion daily active users, up 7% from a year ago, and the \u201cfamily\u201d of Meta apps\u2014which includes Instagram\u2014reported daily active users of 3.96 billion, also up 7%.<\/p>\n

Meta\u2019s stock has skyrocketed 149% so far this year, while the broader S&P 500 index\u00a0
\n SPX
\n has increased 9%. <\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Shares of Meta Platforms Inc. were giving back their gains in Wednesday\u2019s extended session after the Facebook parent company easily topped earnings expectations but spooked Wall Street with its talk of the future. Meta META, -4.17% Chief Financial Officer Susan Li shared on Meta\u2019s earnings call that the company has seen softness in the advertising […]<\/p>\n","protected":false},"author":1,"featured_media":76829,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"video","meta":{"footnotes":""},"categories":[239],"tags":[83],"class_list":["post-76828","post","type-post","status-publish","format-video","has-post-thumbnail","hentry","category-investing","tag-featured","post_format-post-format-video"],"yoast_head":"\nFacebook says Middle East war is hurting ad spending | iFintechWorld<\/title>\n<meta name=\"description\" content=\"Shares of Meta Platforms Inc. were giving back their gains in Wednesday\u2019s extended session after the Facebook parent company easily topped earnings\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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