10-QPeriod: Q2 FY2024

Meta Platforms, Inc. Quarterly Report for Q2 Ended Jun 30, 2024

Filed August 1, 2024For Securities:META

Summary

Meta Platforms, Inc. (META) reported strong financial performance for the second quarter of 2024, with total revenue reaching $39.07 billion, a 22% increase year-over-year. This growth was primarily driven by a 22% increase in advertising revenue, fueled by a 10% rise in ad impressions and a 10% increase in the average price per ad. The company's Family of Apps (FoA) segment continues to be the primary revenue generator, showing robust user engagement with Daily Active People (DAP) up 7% year-over-year. While the core advertising business shows significant strength, Meta's Reality Labs segment continues to incur substantial operating losses, amounting to $4.49 billion for the quarter, reflecting ongoing investments in metaverse technologies. Despite these segment-specific dynamics, Meta demonstrated solid profitability with a net income of $13.47 billion and diluted EPS of $5.16. The company also continued its capital return program, repurchasing $6.32 billion of its Class A common stock and paying $1.27 billion in dividends during the quarter. Management reiterated its commitment to significant investments in AI and the metaverse, anticipating substantial capital expenditures in the coming year.

Financial Highlights

51 data points
Beta

Revenue

$39.07B

81.3% Gross Margin

Net Income

$13.46B

34.5% Net Margin

EPS (Diluted)

$5.16

Total Assets

$230.24B

Cash & Equivalents

$32.05B

Free Cash Flow

$11.20B

Financial Statements
Beta
Revenue$39.07B
Cost of Revenue$7.31B
Gross Profit$31.76B
R&D Expenses$10.54B
Operating Expenses$24.22B
Operating Income$14.85B
Net Income$13.46B
EPS (Basic)$5.31
EPS (Diluted)$5.16
Shares Outstanding (Basic)2.53B
Shares Outstanding (Diluted)2.61B

Key Highlights

  • 1Total revenue increased by 22% year-over-year to $39.07 billion.
  • 2Family of Apps (FoA) revenue grew 22% to $38.72 billion, driven by advertising.
  • 3Reality Labs (RL) revenue increased 28% to $353 million, though the segment reported an operating loss of $4.49 billion.
  • 4Net income rose significantly to $13.47 billion, with diluted EPS of $5.16.
  • 5The company repurchased $6.32 billion of its Class A common stock and paid $1.27 billion in dividends during the quarter.
  • 6Daily Active People (DAP) across Meta's Family of Apps increased by 7% year-over-year to 3.27 billion.
  • 7The company anticipates capital expenditures of $37 billion to $40 billion in 2024, with significant growth expected in 2025.

Frequently Asked Questions

Meta's revenue growth was primarily driven by its advertising business, which saw a 22% increase year-over-year. This growth was supported by an increase in both the number of ad impressions delivered and the average price per ad.

The Reality Labs segment revenue increased by 28% year-over-year to $353 million. However, it continues to operate at a significant loss, with an operating loss of $4.49 billion for the quarter. Meta expects these operating losses to increase meaningfully in 2024 as the company continues to invest heavily in metaverse technologies.

Meta continues to return capital to shareholders. In the second quarter of 2024, the company repurchased $6.32 billion of its Class A common stock and paid $1.27 billion in dividends. The company has an authorized share repurchase program with $60.10 billion remaining as of June 30, 2024, and intends to continue paying a quarterly cash dividend.

Key risks highlighted include continued competition, regulatory scrutiny concerning privacy and antitrust matters, dependence on advertising revenue, the ongoing investment and associated losses in Reality Labs, and potential impacts from changes in mobile operating systems and data privacy regulations on ad targeting and measurement capabilities. The company also faces risks related to cybersecurity and the successful integration of its AI and metaverse initiatives.