Meta Platforms – the American internet company increased its third-quarter revenue by 26 percent year-on-year to 64.60 billion dollars (1.4 trillion CZK) and beat estimates. Profit was also significantly higher, though it fell short of analysts’ expectations. The company reported this in its statement today. It will issue a new class of shares intended to help finance its costly investments in artificial intelligence (AI).
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Meta Platforms reports sharp profit growth and plans 2:1 stock split
Meta’s net profit reached 9.86 billion USD in the third quarter. That marks a 264 percent year-on-year increase, driven by an unusually low comparison base from the previous year, when profit was weighed down by a one-off tax item. The parent company of Facebook, Instagram and WhatsApp announced it will create new Class C common stock without voting rights next January. In practice, this will mean a 2:1 stock split.
According to Reuters, company chief Mark Zuckerberg expects the move to make it easier to finance acquisitions and retain top talent. At the same time, he hopes it will help him maintain control of the group at a time when the race in artificial intelligence is intensifying in Silicon Valley.
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Meta Platforms gains strength from advertising and funds AI race despite fine
“Our investments are paying off, our core business is strong, and we’re seeing dynamic growth everywhere,” Zuckerberg said. The advertising business remained the main driver of revenue. Meta is earning more by getting better at targeting ads, notes Marek Pokorný, analyst at Portu.
Meta shares rose by more than four percent following the release of its financial results. They were unharmed even by today’s news that a court in New Mexico ordered the company to pay 25 billion dollars (540 billion CZK) over its handling of data. According to Ondrej Greguš, an analyst at XTB, investors viewed the growth in the advertising business and the strong revenue outlook positively, despite the heavy investments in AI.
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Source: ČTK
