Meta, the tech giant formerly known as Facebook, recently released its financial report for the second quarter of 2023. The report highlights significant growth in various areas of the company, with one exception – the virtual and augmented reality division, Reality Labs.
Across all divisions of Meta, the daily average users (DAP) reached an impressive 3.07 billion in June 2023, marking a 7% increase from the same period last year. This figure includes the combined audience of WhatsApp, Instagram, Messenger, and Threads. Monthly users (MAP) also saw a 6% increase, reaching 3.88 billion, while Facebook daily users (DAUs) reached 2.06 billion, up 6% from the previous year. Facebook monthly users (MAUs) experienced a 3% increase, totaling 3.03 billion.
In terms of advertising, Meta recorded a 34% increase in ad impressions across all its divisions, while the average ad price decreased by 16%. This contributed to overall revenues of $32.0 billion, representing an 11% increase, or 12% on a constant currency basis, year-over-year.
However, Meta’s financial report also highlights certain challenges the company is facing. Costs and expenses for the quarter amounted to $22.61 billion, up 10% from the previous year. This included accrued legal expenses of $1.87 billion and restructuring charges of $780 million. Investment expenses, including principal payments on finance leases, totaled $6.35 billion.
The company remains committed to its share repurchase program, having bought back $793 million of Class A common stock, leaving $40.91 billion available for future repurchases. As of June 30, 2023, Meta had $53.45 billion in cash, cash equivalents, and marketable securities, with a free cash flow of $10.96 billion. However, the long-term debt stood at $18.38 billion.
One concerning aspect in the financial report is the headcount, which decreased by 14% from the previous year, leaving 71,469 employees. Notably, around half of the employees laid off in 2023 are still included as of June 30, 2023.
Despite some challenges, Meta celebrated the growth of Facebook daily users, which increased by 30 million from the previous quarter. This is particularly significant, as Facebook had experienced a decrease in its audience in the last quarter of 2021. Reels, a short video service similar to TikTok and YouTube Shorts, played a role in this growth, with an impressive 200 billion daily plays, as reported by Mark Zuckerberg.
However, the reality division, Reality Labs, struggled during the reporting quarter. The division recorded an operating loss of $3.7 billion, following losses of $13.9 billion in the previous year and $3.99 billion in the first quarter. Cumulatively, Reality Labs has accumulated losses of $21.3 billion since the beginning of 2022.
Despite the challenges faced by Reality Labs, Meta’s overall financial performance and continued growth in various divisions indicate a resilient and dynamic tech giant. As the company navigates the changing landscape of social media and virtual reality, it remains determined to innovate and lead in the industry.