Reward for Mark Zuckerberg as Facebook Meta owner overcomes year-long slump

Zuckerberg's bold bet on the metaverse, which resulted in him renaming the company from Facebook to Meta in 2021, has still not materialized. bear fruit. Photo: Samuel Corum/Getty Images.

Shares in parent company Facebook Meta soared last night after the company broke a losing streak and posted its first sales increase in a year.

The social media giant reported a 3% increase in sales. an increase in quarterly revenue to $28.6bn (£23bn), belittling Wall Street's forecast of a fourth straight drop in revenue.

However, profits fell 24% and the company reported a significant drop in sales. in his virtual reality division, showing that Mark Zuckerberg's big bet on the metaverse is not working.

The division's revenue fell more than 50 percent to just $339 million despite Zuckerberg's efforts to refocus the company on virtual worlds, and the division lost $4 billion in the first three months of the year alone. Meta has warned that its Reality Labs division's losses are likely to mount over the course of the year.

However, the company's overall revenue growth fell short of expectations that a slowdown in the digital advertising market and Apple's stringent privacy measures will curtail Meta's advertising business bringing money.

Shares rose nearly 10% after the close of trading following the release of the results. Meta's shares fell by two-thirds last year, cutting Zuckerberg's net worth by $90 billion, but since the beginning of 2023, they have rebounded and are now up nearly 80%.

The company said it's over $3 billion for the first time people now use one of his services, such as Facebook, Instagram, and WhatsApp, at least once a day.

Mr. Zuckerberg's decisive bet on the metaverse, which resulted in him renaming the company from Facebook to Meta so far in 2021 hasn't produced any results yet.

Sales of the company's VR headsets have dwindled, and executives have been ordered to devote more time to artificial intelligence amid the proliferation of conversational bots like ChatGPT.

The company cut tens of thousands of jobs in what it called «the year of efficiency.» The company told employees last week that it was ending Instagram operations in London and staff would be asked to relocate to the US.

Meta CFO Susan Lee cut spending forecasts, in part due to widespread layoffs, and expects revenues will rise again next quarter.