Meta Beats Analysts’ Expectations with Strong Revenue Growth in Q1 2024; Concerns About AI Investment and Increasing Expenses Persist

In the first quarter of 2024, Meta, formerly known as Facebook, reported financial results showing revenues of $36.46 billion, a 27% increase from the corresponding quarter. Despite predictions of revenues around $36.1 billion, this growth marks the fifth quarter in a row where Meta has shown strong revenue growth.

Meta’s profit per share stood at $4.71, surpassing analysts’ expectations of $4.3 per share. Revenues from advertising totaled approximately $35.64 billion, slightly above early forecasts. The company has been investing significantly in developing artificial intelligence and the metaverse, with capital expenditures of around $6.72 billion in the last quarter. This investment has been seen positively by Wall Street, as Meta’s net profit is now higher than its capital expenditures.

While Meta has seen success in financial growth and profitability, there are concerns about the increase in expenses and investments related to artificial intelligence development. The company predicts expenses for 2024 to reach $96-99 billion, up from previous estimates, primarily due to higher infrastructure and legal costs. Additionally, annual capital expenditures for 2024 are expected to be in the range of $35-40 billion.

Despite these concerns, Meta seems to be continuously innovating and expanding its offerings. The company recently reported that its Metaverse division generated sales of $440 million in the quarter although it also reported significant losses of $3