Meta reports Q1 revenue of $27.9B, up 7% YoY, net income of $7.5B, down 21% YoY, Family of Apps daily active people of 2.87B, up 6% YoY; stock jumps 10%+

Meta Platforms, Inc. (Nasdaq: FB) today reported nancial results for the quarter ended March 31, 2022.

Meta 2022-04-28

Context & Ripple Effects

This quarter paired continued expansion in Meta's Family of Apps audience with a sharp earnings decline, creating an early benchmark for whether user growth could translate into improved monetization. The next Q1 still showed only modest top-line growth and lower profit in Meta's 2023 Q1 results, even as daily active people continued to rise.

Later reports mark a clear reversal: Q1 2024 revenue and net income growth accelerated sharply while Family daily active people maintained a similar growth rate. That makes the 2022 result a useful starting point for Meta's subsequent earnings recovery.

First-order effects

Meta's share price rose more than 10% after the report, indicating that investors rewarded the revenue and audience growth despite the 21% decline in net income.
Family of Apps added users faster than the company had previously scaled its base, reaching 2.87 billion daily active people and broadening the audience available for monetization.

Second-order effects

With revenue up 7% and daily active people up 6%, Meta's near-term performance puts greater emphasis on revenue growth per active user rather than audience expansion alone.
The earnings decline sets a tougher comparison point for Meta's operating performance; its later return to strong profit growth makes margin recovery as important as user growth in evaluating the business.

Third-order effects

Meta's subsequent results suggest a durable model in which a very large Family of Apps user base can keep expanding while revenue growth varies more sharply with monetization and profitability.
If that pattern persists, the central measure of Meta's platform economics shifts from absolute user scale toward how effectively it converts incremental daily users into revenue and net income.

The trend: Meta's earnings arc points to a maturing social-platform model where steady audience growth supports, but does not by itself determine, revenue and profit expansion.

Discussion

@kurtwagner8 Kurt Wagner on x
FB/Meta earnings are out. User growth for the Facebook social network was better than expected. Revenue was worse than expected, but Meta says that's partly because of the war in Ukraine. Investors seem happy. Stock is up 13% $FB https://twitter.com/...
@bornarci @bornarci on x
Bloomberg calling wrong Revenue results for $FB Meta thrice. Imagine the damage it did to the speculators, I foresee law suits. https://twitter.com/...
@mikeisaac @mikeisaac on x
Facebook earnings out (the real ones) 7 percent revenue growth year-over-year is pretty anemic (though first quarter revs are generally smaller than 4th quarter) also every techco (i care abt) has mentioned Ukraine as a reason for taking an earnings hit https://t.co/hZiW7mpUJV
@gunjanjs Gunjan Banerji on x
“That in effect means Facebook will function more like TikTok's For You feed, which serves users content based on their interests as deter-mined by the company's algorithm, not the accounts they follow” ⁦@sal19 https://www.wsj.com/...
@rustybrick Barry Schwartz on x
FB stock pops 13% after earnings https://twitter.com/...
@epro Emil Protalinski on x
$FB is up 18% after hours for one main reason: 1.6% quarter-over-quarter growth for Facebook daily active users in Q1 2022, after Facebook's first-ever decline in Q4 2021. In other words, investors are hoping Q4 2021 was just a blip. My bet: it wasn't. https://twitter.com/...
@jason_kint Jason Kint on x
Facebook stock up nearly 18% after hours. No logic. I'm sorry but the company is screwed the more I look at this. They're spending $10B on new market despite 0 trust and little expertise while North America ad revenues grew only 1% and their brand is nearly toxic at this point. h…
@samifathi_ Sami Fathi on x
Unfortunately, it seems like Meta has made enough money to still be a thing. https://twitter.com/...
@ldignan Larry Dignan on x
Meta CEO Zuckerberg says “with our current business growth levels, we are now planning to slow the pace of some of our investments,” notably AI infrastructure, business platform and reality labs. https://www.techmeme.com/...
@alexeheath Alex Heath on x
How much does building the metaverse cost? Reality Labs lost $2.96 billion in Q1, up from $1.8 billion last quarter. Spending is so high that Meta's overall operating margin dropped more than 10% from the year-ago quarter. There are roughly 17,000 Reality Labs employees.
@cnbcnow @cnbcnow on x
EARNINGS: Meta Platforms Q1 EPS $2.72 vs. $2.56 Est.; Q1 Revs. $27.91B vs. $28.20B Est. • $FB https://cnbc.com/... https://twitter.com/...
@tier10k @tier10k on x
Bloomberg automation sent out “META PLATFORMS SEES 2Q REV. $27B TO $29B, EST. $30.74B” in error from this press release quoting old earnings $FB briefly down 5% Whoops https://www.globenewswire.com/ ... https://twitter.com/... https://twitter.com/...
@deitaone @deitaone on x
$FB - *CORRECT: META PLATFORMS 2Q REVENUE FORECAST REPORTED IN ERROR
@keubiko @keubiko on x
LOL, sorry about the 30 yards we knocked of your market cap there Zucky. https://twitter.com/... https://twitter.com/...
@deitaone @deitaone on x
*CORRECT: META PLATFORMS DID NOT REPORT EARNINGS $FB https://twitter.com/...
@ms75015577 @ms75015577 on x
@DeItaone Wtf? Why right now?
@mikeisaac @mikeisaac on x
(Facebook has reported earnings at 1:05 pm PT after the bell like clockwork for years now, so this popping at 10am was really weird to begin with and should have set off alarm bells)
@hmeisler Helene Meisler on x
uh oh https://twitter.com/...
@mikeisaac @mikeisaac on x
From what i've been told this is an erroneous headline and didn't come from Facebook. Seems like a screwup by Bloomberg somehow. It has also appeared to tank the FB stock. https://twitter.com/...
@shiraovide Shira Ovide on x
This was one of the things I was curious about: What does Meta's profit and profit margin look like without the metaverse money pit. Answer: Profits are great but not as great as 2021. Operating profit margin excluding metaverse/VR stuff was 42%. (Full year 2021 was 49%.) https:/…
@mattnavarra Matt Navarra on x
Meta says its metaverse division lost another $3B “I recognize it's expensive to build this. It's something that's never been built before” - Mark Zuckerberg https://techcrunch.com/...
@ivanthek @ivanthek on x
Am I doing this right? $FB https://twitter.com/...
@scobleizer Robert Scoble on x
@SadlyItsBradley High resolution means you can do real work. On Quest 2 headset I can't use Tweetdeck, for instance. The resolution just isn't there.
@sadlyitsbradley Brad Lynch on x
@Scobleizer Thats whats bizarre about Cambria. It only uses 2160p screens. Not much different from Quest 2
@tfadell Tony Fadell on x
“In Q1 alone, Meta's Metaverse/Reality Labs operated at a loss of $2.96 billion, and last year, Reality Labs lost over $10 billion.” The iPhone didn't even cost $3B to build, let alone $13B... F&@k the Metaverse! https://techcrunch.com/...
@patrickmoorhead Patrick Moorhead on x
Meta on a do or die #metaverse mission. Wondering about its investment in client-side silicon. DC silicon makes a lot of sense to me, though. https://twitter.com/...
@scobleizer Robert Scoble on x
@SadlyItsBradley If true then it can't replace a laptop. Sigh.
@nickstatt Nick Statt on x
Making Horizon Worlds the equivalent of the Quest home base and gateway to all other VR experiences could go a long way in making it competitive with other gaming metaverse platforms. But still requires you buy and use a headset. https://twitter.com/...
@lanshandle Lan on x
“eventually replacing your laptop” lol https://twitter.com/...
@alexeheath Alex Heath on x
High-end mixed reality headset, codenamed Cambria, is coming later this year. (Am told it will be similar to what Apple has coming) Cambria focused on “work use cases and eventually replacing your work laptop,” says Zuck. Will have eye and face tracking for richer interactions
@alexeheath Alex Heath on x
Zuck says a web version of @HorizonWorlds is coming later this year (nothing on mobile app but assuming that too). Horizon will be integrated in the Quest headset so that when you first put it on you'll be “embodied by your Meta avatar” and see Horizon on boot up
@nathievr @nathievr on x
@CharlieBlix We don't need a Quest 3 for consumers, we need games.
@charlieblix Josh on x
@NathieVR I have a Quest 1. When Quest 2 came out so soon after the 1st I figured I'd wait another generation to upgrade. Now I'm worried Cambria isn't going to be the “Quest 3” I thought it would be. Damn... wish we knew the refresh cycle for the Quest line so I can make smart c…
@shiraovide Shira Ovide on x
Just mentioning that in 2019, Facebook's growth rate was like 25%.
@matthew41905514 Matthew Isaiah on x
With all that we know now, does anyone actually believe that Facebook has returned to “user growth”? https://twitter.com/...
@shiringhaffary @shiringhaffary on x
Facebook's user base is no longer shrinking. Seeing the most growth in Asia-Pac and other countries outside of US/Canada/Europe. https://twitter.com/...
@shiraovide Shira Ovide on x
Note that average revenue per user in Facebook's biggest ad market barely increased from a year ago. Not great. https://twitter.com/...
@shiraovide Shira Ovide on x
Good news! Facebook users aren't shrinking anymore! Bad news: Facebook's revenue growth evaporated. 7% revenue growth in 1Q. Forecast at midpoint of guidance is for a slight DECLINE of revenue YoY.
@alexeheath Alex Heath on x
Mark Zuckerberg on Meta earnings call moments ago: “with our current business growth levels, we are now planning to slow the pace of some of our investments” Shows the level of pressure he is under
@alexeheath Alex Heath on x
That said, Meta is still very much in the woodshed. 5 years of stock growth evaporated https://twitter.com/...
@alexeheath Alex Heath on x
Meta is clearly aware that investors fear it overspending on future stuff when the core biz is so challenged by Apple, TikTok, and other factors. https://twitter.com/...
@munster_gene Gene Munster on x
$FB CFO say Reels is additive to overall engagement and overall engagement in the US remains above where it was before the pandemic.
@kimbenabib Kim Benabib on x
7 years? Mao and Stalin dealt in 5-year plans. I'm not sure investors are going to be this patient. https://twitter.com/...
@politics1com @politics1com on x
I may be in the minority, but I liked @instagram when it was almost entirely photos. I find Reels intrusive, annoying, and just clutters up my feed... https://twitter.com/...
@munster_gene Gene Munster on x
Reels is 20% of time on Instagram which means TikTok is being kept in check.
@munster_gene Gene Munster on x
He added that the expenses of building the metaverse is happening today, and the revenue will come late in the decade. That means margin expansion in . . . . 2030.
@munster_gene Gene Munster on x
Zuckerberg suggested it's going to take 7 plus years to monetize the metaverse. That's about 3 years longer than I was thinking.
@munster_gene Gene Munster on x
Sandberg says Reels is fast growth and they have a multi-year plan to increase monetization. What's holding it up? Advertisers need to build creative optimized for Reels. I believe it because that's how Stories monetization played out.
@shiringhaffary @shiringhaffary on x
On earnings call, Zuck saying Reels now makes up 20% of people's time spent on Instagram. I wrote a story about how FB/Insta is heavily promoting Reels last month: https://www.vox.com/...

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