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AI助Meta Q4业绩创纪录但Q1指引逊色,今年支出或增六成,“烧钱”以应对DeepSeek

AI helps Meta achieve record performance in Q4, but the Q1 guidance falls short. This year's spending may increase by sixty percent, "burning money" to cope with DeepSeek.

wallstreetcn ·  Jan 29 23:47

In the fourth quarter, Meta's total revenue and advertising revenue both increased by 21% year-on-year, with EPS earnings 18% higher than Analyst expectations and over 50% year-on-year growth. The Metaverse Business incurred a loss of nearly 5 billion dollars, slightly below expectations; the daily active users of the Facebook and other applications family exceeded expectations, growing by 5% to 3.35 billion.

The revenue guidance for the first quarter indicates a minimum increase of 8%, a significant slowdown, with no full-year revenue guidance provided; this year's capital expenditure guidance reaches 65 billion dollars, which is 24% higher than Analyst expectations.

Zuckerberg stated that the latest Llama model has achieved 'significant progress' and believes there is room in the market for multiple AI Apps to thrive.

In the last quarter of last year, $Meta Platforms (META.US)$ sales and profits reached a historic high, reflecting the enhancement of digital advertising business through the application of AI technology. The Metaverse business, featuring Quest VR headsets and smart glasses, continued to incur losses, but the losses were slightly lower than expected.

Facing the challenge from China's new AI force DeepSeek with its high cost-performance open-source models, Meta plans to keep "burning money" this year to support its development of AI and its core businesses. However, the disappointing guidance for this quarter raises doubts about whether Meta's "cash cow" digital advertising can grow quickly enough to meet the company's investment needs in future-oriented businesses such as AI and the Metaverse.

On January 29, Wednesday, Eastern Time, Meta announced its financial data for the fourth quarter ended December 31, 2024.

1) Key Financial Data

Revenue: Fourth-quarter revenue stood at 48.385 billion dollars, a year-on-year increase of 21%, while analysts expected 46.949 billion dollars, with a 19% growth in the third quarter.

EPS: The diluted earnings per share (EPS) for the fourth quarter was $8.02, a year-on-year increase of 50.5%, compared to the Analyst's expectation of $6.75, and an increase of nearly 37.4% compared to the third quarter.

Capital Expenditure: Including principal payments for financing leases, fourth quarter capital expenditure was $14.84 billion, a year-on-year increase of 87.8%, compared to a year-on-year increase of 36% to $9.2 billion in the third quarter, with an annual total of $39.23 billion.

Operating Profit: The operating profit for the fourth quarter was $23.365 billion, a year-on-year increase of 43%, compared to the Analyst's expectation of $20.09 billion, and an increase of 26% compared to the third quarter.

Net Income: Net income for the fourth quarter was $20.838 billion, a year-on-year increase of 49%, and a 35% increase compared to the third quarter.

2) Segmented Business Data

Advertising: Advertising revenue for the fourth quarter was $46.78 billion, a year-on-year increase of about 21%, with an 18.7% increase compared to the third quarter.

Family of Apps: The family of apps, including Facebook, Instagram, Messenger, WhatsApp, and other services, generated revenue of $47.3 billion in the fourth quarter, a year-on-year increase of about 21%, compared to the Analyst's expectation of $45.972 billion, and a 29% year-on-year increase compared to the third quarter. For this segment, the operating profit for the fourth quarter was $28.33 billion, a nearly 35% year-on-year increase, compared to the Analyst's expectation of $25.3 billion.

Reality Labs: Including Hardware, Software, and content related to AR (Augmented Reality) and VR (Virtual Reality), the Metaverse related business in Reality Labs generated revenue of $1.08 billion in the fourth quarter, a year-on-year increase of 1%, compared to the Analyst's expectation of $1.108 billion, and a 29% year-on-year increase compared to the third quarter. The operating loss for the quarter was $4.97 billion, with a year-on-year loss increase of about 7%, compared to the Analyst's expectation of a loss of $5.1 billion.

3) Performance guidance

Revenue: The revenue for the first quarter of 2025 is expected to be between 39.5 billion and 41.8 billion US dollars, with analysts expecting 41.67 billion dollars.

Expenses: The total expenses for 2025 are expected to be between 114 billion and 119 billion US dollars, with analysts expecting 108.01 billion dollars.

Capital Expenditure: The total capital expenditure for 2025 is expected to be between 60 billion and 65 billion US dollars, with analysts expecting 52.41 billion dollars.

Before the earnings report was released, Meta's stock price, having risen over 0.3%, initially fell more than 4% in Post-Market Trading, then turned to gain, and after the earnings report was released, quickly erased the small gains in after-hours trading and turned to decline, once dropping over 5%, later turning to rise again, having risen more than 5%, with the significant increase narrowing to 1.68%.

In the fourth quarter, total revenue and advertising revenue both increased by 21%, with EPS increasing by more than 50%.

The earnings report shows that Meta performed exceptionally well in the fourth quarter, with revenue and EPS both exceeding expectations, breaking the company's own record for the highest revenue in a single quarter, and accelerating growth compared to the third quarter.

Of this, revenue was 3% higher than analyst expectations, with a year-on-year growth rate exceeding 20%, and EPS was 18% higher than analyst expectations with a year-on-year growth slightly above 50%, well over 30% higher than the expected growth from analysts. Digital advertising, which accounts for 97% of the company's total revenue, also achieved a rare strong growth of over 20% in the fourth quarter.

The Business segment, including Social Media platforms like Facebook, saw revenue growth in the fourth quarter slow compared to the third quarter, yet still increased by over 20%, and exceeded Analyst expectations by 2.6%. The daily active users (DAU) of the app family reached 3.35 billion in the fourth quarter, a year-on-year increase of 5%, surpassing the Analyst expectation of 3.292 billion.

The revenue from the Reality Labs segment related to the Metaverse slightly fell short of Analyst expectations in the fourth quarter, but the losses for the season were less than anticipated, with annual revenue growing by 13%.

No revenue guidance has been provided for this year, and capital expenditures may exceed Analyst expectations by more than 20%.

Meta's performance guidance disappointed Wall Street. The revenue guidance for the first quarter is below expectations, equating to a year-on-year growth of 8% to 15%, with the entire guidance Range's growth rate significantly lower than the fourth quarter's 21%. The mean expected by Analysts is at the high end of the guidance range. Furthermore, Meta did not provide revenue guidance for the entire year, only stating that investments in the company's core Business are expected to offer strong growth opportunities for annual revenue.

Regarding Capital Expenditures, Meta reiterated the plan announced by CEO Mark Zuckerberg last Friday, with this year's capital expenditures expected to reach 60 billion to 65 billion USD, which is 14.5% to 24% higher than Analyst expectations. Based on this guidance, Meta's planned capital expenditures this year will increase by 52.9% to 65.7% compared to last year.

Meta stated that the growth in capital expenditures for the entire year will stem from increased investments in generative AI and the company's core Business, with expenditures being directly allocated to core operations throughout the year.

As seen in the chart below, Meta's capital expenditures were both below expectations in the second and third quarters of last year, followed by a significant rebound and large exceedance of expectations in the fourth quarter.

Zuckerberg: The latest Llama model has made "significant progress."

The recent success of DeepSeek has raised significant doubts in the market about whether the investment returns from major USA technology giants like Meta spending heavily to develop AI are reasonable.

Although the American industry praises the achievements of Deep Seek, commentators believe that behind the accolades, there is a consensus among American politics, Wall Street, and Silicon Valley that DeepSeek is a major competitor to Meta's open-source model Llama. Several Wall Street Analysts stated on Monday that DeepSeek's innovations indicate that Meta is lagging in the AI race.

During Meta's fourth-quarter earnings call, Zuckerberg stated that Meta's latest Llama model is making "great progress."

Despite Llama facing fierce competition from models both domestically and internationally, Zuckerberg still expressed his belief that there is room in the market for multiple AI applications to thrive.

Zuckerberg said that users want their AI to be personalized based on their environment, personal interests, personalities, cultures, and perspectives on the world. "I do not believe there will be one large AI that everyone uses for the same thing. People will be able to choose how their AI works and what it looks like to them."

In addition to predicting that Meta's AI assistants will perform industry-leading in what will be a "significant year" for the entire AI Industry, Zuckerberg also stated that he anticipates being able to "potentially build an AI agent with the coding and problem-solving skills of a mid-level engineer this year. This will be a far-reaching milestone and could become one of the most important innovations in history." He hopes that Meta will achieve this goal.

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Editor/Somer

The translation is provided by third-party software.


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