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Meta $FB 1Q22 Earnings 
https://abs.twimg.com/emoji/v2/... draggable="false" alt="💪🏻" title="Aangespannen biceps (lichte huidskleur)" aria-label="Emoji: Aangespannen biceps (lichte huidskleur)">
- Rev $27.9b +7%https://abs.twimg.com/emoji/v2/... draggable="false" alt="↗️" title="Noord-oost pijl" aria-label="Emoji: Noord-oost pijl">
- EBIT $8.5b -25%https://abs.twimg.com/emoji/v2/... draggable="false" alt="↘️" title="Zuid-oost pijl" aria-label="Emoji: Zuid-oost pijl"> margin 31% -1293 bps https://abs.twimg.com/emoji/v2/... draggable="false" alt="↘️" title="Zuid-oost pijl" aria-label="Emoji: Zuid-oost pijl">https://abs.twimg.com/emoji/v2/... draggable="false" alt="❌" title="Kruis" aria-label="Emoji: Kruis">
- Net Income $7.5b -21%https://abs.twimg.com/emoji/v2/... draggable="false" alt="↘️" title="Zuid-oost pijl" aria-label="Emoji: Zuid-oost pijl"> margin 27% -954 bps https://abs.twimg.com/emoji/v2/... draggable="false" alt="↘️" title="Zuid-oost pijl" aria-label="Emoji: Zuid-oost pijl">https://abs.twimg.com/emoji/v2/... draggable="false" alt="❌" title="Kruis" aria-label="Emoji: Kruis">
- OCF $14.1b +15%https://abs.twimg.com/emoji/v2/... draggable="false" alt="↗️" title="Noord-oost pijl" aria-label="Emoji: Noord-oost pijl"> margin 50% +366 bps https://abs.twimg.com/emoji/v2/... draggable="false" alt="✅" title="Groot wit vinkje" aria-label="Emoji: Groot wit vinkje">
- FCF $8.5b +9%https://abs.twimg.com/emoji/v2/... draggable="false" alt="↗️" title="Noord-oost pijl" aria-label="Emoji: Noord-oost pijl"> margin 31%https://abs.twimg.com/emoji/v2/... draggable="false" alt="⭐️" title="Middelgrote ster" aria-label="Emoji: Middelgrote ster"> +68 bps https://abs.twimg.com/emoji/v2/... draggable="false" alt="✅" title="Groot wit vinkje" aria-label="Emoji: Groot wit vinkje">
- Rev $27.9b +7%
- EBIT $8.5b -25%
- Net Income $7.5b -21%
- OCF $14.1b +15%
- FCF $8.5b +9%
Business Metrics - Flat QoQ https://abs.twimg.com/emoji/v2/... draggable="false" alt="➡️" title="Pijl naar rechts" aria-label="Emoji: Pijl naar rechts">
- DAP 2.87b +6%https://abs.twimg.com/emoji/v2/... draggable="false" alt="↗️" title="Noord-oost pijl" aria-label="Emoji: Noord-oost pijl"> +1.8%QoQ https://abs.twimg.com/emoji/v2/... draggable="false" alt="➡️" title="Pijl naar rechts" aria-label="Emoji: Pijl naar rechts">
- MAP 3.64b +6%https://abs.twimg.com/emoji/v2/... draggable="false" alt="↗️" title="Noord-oost pijl" aria-label="Emoji: Noord-oost pijl"> +1.4%QoQ https://abs.twimg.com/emoji/v2/... draggable="false" alt="➡️" title="Pijl naar rechts" aria-label="Emoji: Pijl naar rechts">
- DAP 1.96b +4%https://abs.twimg.com/emoji/v2/... draggable="false" alt="↗️" title="Noord-oost pijl" aria-label="Emoji: Noord-oost pijl"> +1.6%QoQ https://abs.twimg.com/emoji/v2/... draggable="false" alt="➡️" title="Pijl naar rechts" aria-label="Emoji: Pijl naar rechts">
- MAU 2.94b +3%https://abs.twimg.com/emoji/v2/... draggable="false" alt="↗️" title="Noord-oost pijl" aria-label="Emoji: Noord-oost pijl"> +1.0%QoQ https://abs.twimg.com/emoji/v2/... draggable="false" alt="➡️" title="Pijl naar rechts" aria-label="Emoji: Pijl naar rechts">
- Ad Impressions +15%https://abs.twimg.com/emoji/v2/... draggable="false" alt="↗️" title="Noord-oost pijl" aria-label="Emoji: Noord-oost pijl">
- Avg Price per Ad -8%https://abs.twimg.com/emoji/v2/... draggable="false" alt="↘️" title="Zuid-oost pijl" aria-label="Emoji: Zuid-oost pijl">https://abs.twimg.com/emoji/v2/... draggable="false" alt="❌" title="Kruis" aria-label="Emoji: Kruis">
- Headcount 77.8K +28%https://abs.twimg.com/emoji/v2/... draggable="false" alt="📶" title="Antenne met staven" aria-label="Emoji: Antenne met staven">
- DAP 2.87b +6%
- MAP 3.64b +6%
- DAP 1.96b +4%
- MAU 2.94b +3%
- Ad Impressions +15%
- Avg Price per Ad -8%
- Headcount 77.8K +28%
By Segment
1) Family of Apps
- Rev $27.2b +4%https://abs.twimg.com/emoji/v2/... draggable="false" alt="↗️" title="Noord-oost pijl" aria-label="Emoji: Noord-oost pijl">
- EBIT $11.5b -13%https://abs.twimg.com/emoji/v2/... draggable="false" alt="↘️" title="Zuid-oost pijl" aria-label="Emoji: Zuid-oost pijl"> margin 42% -826 bps https://abs.twimg.com/emoji/v2/... draggable="false" alt="↘️" title="Zuid-oost pijl" aria-label="Emoji: Zuid-oost pijl">https://abs.twimg.com/emoji/v2/... draggable="false" alt="❌" title="Kruis" aria-label="Emoji: Kruis">
2) Reality Labs
- Rev $0.7b +30%https://abs.twimg.com/emoji/v2/... draggable="false" alt="↗️" title="Noord-oost pijl" aria-label="Emoji: Noord-oost pijl">
- EBIT -$3.0bhttps://abs.twimg.com/emoji/v2/... draggable="false" alt="↘️" title="Zuid-oost pijl" aria-label="Emoji: Zuid-oost pijl"> margin -426% -8376 bps https://abs.twimg.com/emoji/v2/... draggable="false" alt="↘️" title="Zuid-oost pijl" aria-label="Emoji: Zuid-oost pijl">https://abs.twimg.com/emoji/v2/... draggable="false" alt="❌" title="Kruis" aria-label="Emoji: Kruis">
1) Family of Apps
- Rev $27.2b +4%
- EBIT $11.5b -13%
2) Reality Labs
- Rev $0.7b +30%
- EBIT -$3.0b
Mgmt Guide
- 2Q22 Rev $28-30bhttps://abs.twimg.com/emoji/v2/... draggable="false" alt="➡️" title="Pijl naar rechts" aria-label="Emoji: Pijl naar rechts">
- 3% FX Headwindhttps://abs.twimg.com/emoji/v2/... draggable="false" alt="↘️" title="Zuid-oost pijl" aria-label="Emoji: Zuid-oost pijl">
- Expect global MAU to be flat to down sequentially in 2Q22 (because of loss of users in Russia).https://abs.twimg.com/emoji/v2/... draggable="false" alt="➡️" title="Pijl naar rechts" aria-label="Emoji: Pijl naar rechts">https://abs.twimg.com/emoji/v2/... draggable="false" alt="↘️" title="Zuid-oost pijl" aria-label="Emoji: Zuid-oost pijl">
- 2Q22 Rev $28-30b
- 3% FX Headwind
- Expect global MAU to be flat to down sequentially in 2Q22 (because of loss of users in Russia).
1 | Three Near Term Challenges
1) Transition to Short-Form Video (Reels)
“Some are specific to Meta, like our transition to short-form video, which doesn& #39;t monetize as well for now but which we& #39;re quite optimistic about over the long term.
1) Transition to Short-Form Video (Reels)
“Some are specific to Meta, like our transition to short-form video, which doesn& #39;t monetize as well for now but which we& #39;re quite optimistic about over the long term.
2) Signal Loss due to Apple’s iOS changes
“Some are specific to our industry, like signal loss resulting from Apple& #39;s iOS changes, which is a meaningful headwind, but we also expect that with the right technology investments we& #39;ll navigate okay over time.”
“Some are specific to our industry, like signal loss resulting from Apple& #39;s iOS changes, which is a meaningful headwind, but we also expect that with the right technology investments we& #39;ll navigate okay over time.”
3) Macroeconomic Softness
“Other challenges are broader macro trends, like the softness in e-commerce.
We& #39;ve been blocked in Russia and we decided to stop accepting ads from Russian advertisers globally.”
“Other challenges are broader macro trends, like the softness in e-commerce.
We& #39;ve been blocked in Russia and we decided to stop accepting ads from Russian advertisers globally.”
2 | Still long-term confident of return to growth and higher profitability
“On the Family of Apps side, I am confident that we can return to better revenue growth rates over time and sustain high operating margins.”
“On the Family of Apps side, I am confident that we can return to better revenue growth rates over time and sustain high operating margins.”
3 | Family of Apps funding Reality Labs
“…next several years, our goal from a financial perspective is to generate sufficient operating income growth from Family of Apps to fund the growth of investment in Reality Labs, while still growing our overall profitability.”
“…next several years, our goal from a financial perspective is to generate sufficient operating income growth from Family of Apps to fund the growth of investment in Reality Labs, while still growing our overall profitability.”
4 | But Revenue Headwinds making that challenging
“Now unfortunately, that& #39;s not going to happen in 2022, given the revenue headwinds.”
“Now unfortunately, that& #39;s not going to happen in 2022, given the revenue headwinds.”
5 | 3 Investment Priorities: Reels, Ads and the Metaverse
“…seeing in 3 of our main investment priorities that I expect to drive this growth: Reels, Ads and the Metaverse.”
“…seeing in 3 of our main investment priorities that I expect to drive this growth: Reels, Ads and the Metaverse.”
6 | Ad Strategy - Less Data using AI and ML to improve
“3 main areas: one, growing video monetization, especially short-form video like Reels; two, evolving our ad systems to do more with less data; and three, investing in AI & ML to support our ads infrastructure.”
“3 main areas: one, growing video monetization, especially short-form video like Reels; two, evolving our ad systems to do more with less data; and three, investing in AI & ML to support our ads infrastructure.”
7 | Confident in turning Reels from Headwind to Tailwind
2012: Desktop Feed to Mobile Feed
2018: Feed to Stories
2022: Feed to Stories
“So we& #39;ve run this play before, and we& #39;re running it again now.”
2012: Desktop Feed to Mobile Feed
2018: Feed to Stories
2022: Feed to Stories
“So we& #39;ve run this play before, and we& #39;re running it again now.”
8 | Positioning.
“…we& #39;re positioning ourselves as the premier company for building the future of social interaction and the Metaverse.”
“…we& #39;re positioning ourselves as the premier company for building the future of social interaction and the Metaverse.”
9 | Watch for Project Cambria, high-end headset more focused in work use cases.
“Later this year, we& #39;ll release a higher-end headset code-named Project Cambria, which will be more focused on work use cases and eventually replacing your laptop or work setup.”
“Later this year, we& #39;ll release a higher-end headset code-named Project Cambria, which will be more focused on work use cases and eventually replacing your laptop or work setup.”
DAUs flattening. Mgmt is aware of the need to transition to Short Form Video via Reels away from Feeds & Stories. Not the first transition for FB. Near-term pressure continues on revenues and profitability.
But if they can repeat the successful playbook, this could prove as pivotal as prior. Too early to tell, still holding. Metaverse / VR is still a couple of years out, now they need to execute, next couple of quarters will become clearer.
