Meta's shares fell after company CEO Mark Zuckerberg spoke loudly: it will be a while before AI ventures begin to pay back the huge financial investments they are making.
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At first glance, the results for the first calendar quarter of 2024 looked promising. Revenue rose 27 percent year over year to $36.5 billion, operating profit nearly doubled, climbing 91 percent to $13.8 billion, and operating margin rose from 25 percent to 38 percent.
Analysts would normally have also taken kindly to the 10 percent reduction in headcount, down to 69,329 on March 31, 2024.
But an otherwise rosy set of results was marred first by the admission that Meta expects losses from its VR division, Reality Labs, to continue to widen — the operating loss was $3.8 billion for the first quarter — and capex for 2024 will increase from between $30-$37 billion to $35-40 billion "as we continue to accelerate our infrastructure investments to support our artificial intelligence (AI) roadmap."
