Mark Zuckerberg’s grip on Facebook owner Meta will come under more scrutiny if tonight’s results disappoint, according to a series of reports this week.
In particular, the hard cash cost of the company’s foray into the metaverse has begged questions over what it's for and whether is it just a Zuckerberg pet/ hobby project.
If so, it’s an expensive one. In 2021, Meta invested US$10bn in the metaverse and is expected to do the same again this year.
Meta’s shares are down over 60% year to date and investors are getting itchy about when rewards from the metaverse adventure might become a little more tangible.
Analysts expect a decline in revenues and a bloated expenses bill in the social media giant’s third-quarter results.
The company’s revenue guidance is between $26bn and $28.5bn, a roughly 1% drop against second-quarter actuals.
But expenses will be the real focal point. Meta expects a full-year tally of up to US$88bn, and that’s taking into account recent workforce reductions.
These eye-watering numbers are largely driven by the company’s metaverse ambitions.
On a positive note, Meta is expected to post a strong uptick in user numbers across its various platforms, but that comes as little relief given the consensus earnings per share estimate of US$1.82 is -43.5% down year on year.