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Meta Platforms (META)

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Updated Aug 16, 2024 04:00 PM ET

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• Applied Materials-stock
• News for Applied Materials

Here's what to expect from Applied Materials's earnings report

• On August 15, Applied Materials will report earnings from Q3.
• Analysts expect Applied Materials will report earnings per share of $2.03.
• Follow Applied Materials stock price in real-time here.

On August 15, Applied Materials reveals earnings for Q3.

27 analysts estimate earnings of $2.03 per share compared to earnings of $1.86 per share in the same quarter of the previous year.

Analysts are expecting sales to increase 4.05% compared to the prior year quarter. The company is expected to report $6.68 billion.

With regard to the current fiscal year, analysts forecast a profit per share of $8.42. Last year it was $8.16 per share. In terms of sales, analysts estimate that the company will bring in $27.00 billion in the current fiscal year, compared to $ 26.45 billion in the same period last year.

This story was written by Markets Insider's RoboEddy, which automatically writes these stories based on data provided by our partners.

Applied Materials News MORE

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Should You Buy Nvidia Stock Before Aug. 28? Here's What the Evidence Suggests.

• Nvidia stock has gained 619% since the advent of AI early last year.
• The company has become the standard bearer for the AI revolution.
• Plenty of evidence suggests its epic run will continue, albeit not in a straight line.
• Motley Fool Issues Rare “All In” Buy Alert

NASDAQ: NVDA

The AI chipmaker is scheduled to report results later this month. Can the stock continue its relentless climb?

The adoption of artificial intelligence (AI) is ongoing, but some investors fear the trend is getting a little long in the tooth. Fears about the economy and weakness in AI stocks helped push the Nasdaq Composite into correction territory earlier this month, and with valuations stretched, some believe there could be further declines ahead.

Nvidia ( NVDA 1.40% ) has become the poster child for the generative AI trend. When the company reports its results later this month, it's not hyperbole to suggest that Wall Street will be sitting on the edge of its seat, hoping to gain insight into the state of AI adoption.

Nvidia's sales have skyrocketed since the start of 2023, driving the stock up 619% (as of this writing), though it's currently more than 22% off its high.

With so much riding on Nvidia's quarterly results, investors are wondering whether the recent stock price decline represents a buying opportunity ahead of the company's highly anticipated financial report. Let's review the available evidence.

Image source: Getty Images.

Anecdotal data is strong

The biggest driver for Nvidia over the past 18 months has been the rapid adoption of generative AI by cloud infrastructure providers best positioned to monetize AI. Nvidia's graphics processing units (GPUs) are the gold standard for these applications.

As a result, cloud infrastructure providers, including Amazon Web Services, Microsoft Azure, and Alphabet 's Google Cloud, have been upgrading their data centers to provide the computational horsepower needed to run AI. Even Meta Platforms has jumped on the bandwagon, creating one of the leading large language models (LLMs) so it can profit from AI.

Demand for Nvidia's AI-centric processors remains robust among the cloud leaders, and each has highlighted plans for higher capex spending to support their AI aspirations. This bodes well for Nvidia in the current quarter.

Rivals and partners are reporting robust sales

There's further evidence that suggests Nvidia's results will be robust.

Advanced Micro Devices ( AMD 0.81% ) , otherwise known as AMD, is one of Nvidia's biggest rivals in the GPU space. The company reported its second-quarter results late last month, and the strength of its AI-related sales caught many market watchers off guard. While revenue grew 9% year over year and beat expectations, its data center sales surged to a record $2.58 billion, up 115%, driven higher by soaring demand for AI.

Arm Holdings ( ARM -0.11% ) creates the CPU cores found in many of Nvidia's AI processors, and its results were similarly upbeat. For its fiscal 2025 first quarter (ended June 30), Arm reported its fourth consecutive quarter of record results. The company generated record revenue of $939 million, up 39% year over year, the result of record license revenue driven by "the proliferation of AI."

Super Micro Computer ( SMCI 0.34% ) supplies server and storage solutions featuring next-generation AI processors from Nvidia and others. For the company's fiscal 2024 fourth quarter (ended June 30), revenue of $5.3 billion grew 143% year over year and 38% quarter over quarter. Despite its parabolic growth rate, management noted Supermicro continued to be hamstrung by short-term "supply chain bottlenecks."

The thread that runs through these AI players is that demand remained strong in the most recent quarter, driven by the secular tailwind of AI. This suggests Nvidia's sales should be similarly robust.

Stock splits are bullish

There are other reasons to believe Nvidia stock could have additional upside from here. Research by analysts at Bank of America shows that in the 12 months following a stock-split announcement, stock-split stocks gained 25%, on average, compared to just 12% for the S&P 500 .

Since Nvidia announced its stock split on May 22, the stock has actually fallen 19% (as of this writing), as fears regarding the state of the economy overshadowed the tailwinds of AI. If history is any indicator, Nvidia still has plenty of double-digit upside potential ahead.

Is the stock a buy before August 28?

For investors looking to make a fast buck, Nvidia is likely not the stock for you. As the recent stock chart shows, Nvidia has been -- and will continue to be -- a volatile stock. While investors who bought last year are likely sitting on triple-digit gains, those who bought last month could be down more than 22%. This helps to illustrate a timeless investing truth: It's best to buy shares in the best companies you can find and hold them for three to five years, as you're less likely to suffer the impact of short-term volatility.

For those wondering whether Nvidia stock will go up or down after its upcoming financial report, your guess is as good as mine. I sent my crystal ball to the shop years ago, but it still hasn't come back. Furthermore, anyone who professes to know what will happen in the days or weeks that follow is being less than truthful.

If I were to hazard a guess -- and that's all it would be -- I suspect Nvidia will report another quarter of record sales. Analysts' consensus estimates are calling for revenue of $28.52 billion, slightly ahead of Nvidia's guidance of $28 billion. However, much of how the stock price reacts in the wake of the report will depend on the company's profitability and Nvidia's forward-looking guidance.

It's important to take a step back and look at the big picture. Nvidia's GPUs are the gold standard for AI processing, and while there's always the threat of competition, no heir apparent has emerged. Most experts believe it's still early innings for generative AI as adoption continues to ramp up. Even the most conservative estimates suggest that generative AI will be a trillion-dollar market, with some forecasts multitudes higher.

Nvidia stock trades at a premium of 38 times earnings (as of this writing), but the company's triple-digit growth, industry-leading position, and long track record show that it's worth every penny.

My advice to you is this: If you believe -- like I do -- that AI has a long way to go and Nvidia will maintain its dominance in the market, then buy Nvidia stock and hold on for dear life.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Bank of America is an advertising partner of The Ascent, a Motley Fool company. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Danny Vena has positions in Alphabet, Amazon, Meta Platforms, Microsoft, Nvidia, and Super Micro Computer. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Amazon, Bank of America, Meta Platforms, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy .

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Meta earnings recap: Stock climbs as advertising drives revenue beat, while Zuckerberg doubles down on AI spending

• Meta's Q2 revenue and earnings beat estimates Wednesday, driven by strength in its ads business.
• It's still spending big on Reality Labs and expects significant capex growth in 2025 for AI.
• CEO Mark Zuckerberg reiterated it'll take time to see a significant return on its AI investments.

Meta reported second-quarter earnings on Wednesday after the closing bell, and it looks like another win for Mark Zuckerberg.

The Facebook parent's revenue and earnings-per-share beat consensus analyst estimates, driven by better-than-expected advertising sales.

Like other tech giants, Meta has been heavily investing in generative AI with little to show for it so far, but CEO Zuckerberg defended its spending plans in the earnings call Wednesday.

"Before we're really talking about monetization of any of those things by themselves, I don't think anyone should be surprised I would say that would be years," he said, noting that "the early signals on this are good."

Zuckerberg also said in the earnings release that the company's chatbot, Meta AI, is on pace to become the most widely used in the world by the end of 2024.

Meta's stock rose more than 6% in after-hours trading shortly after the results. The stock rose 2.5% on Wednesday, and has gained a robust 34% so far in 2024.

Meta expects headcount to be "meaningfully higher" at the end of this year than the end of 2023

Asked about head count, CFO Susan Li said, "We continue to be disciplined about where we're allocating new head count to ensure it's really focused on our core company priorities."

Meta expects its head count at the end of this year to be "meaningfully higher than where we ended 2023," she added.

After laying off more than 20,000 workers since late 2022, Zuckerberg proclaimed 2023 the "year of efficiency" at Meta .

Zuckerberg reiterates AI spending is a long-term bet

In the Q&A portion of the call, Meta execs were asked right out of the gates about the company's spending on AI and when Meta might see bigger returns from it.

Zuckerberg reiterated that it'll be a while before Meta sees notable revenue from its AI investments, emphasizing, "We have a relatively long business cycle."

"But before we're really talking about monetization of any of those things by themselves, I don't think anyone should be surprised I would say that would be years," he said. But "the early signals on this are good."

Meta CFO Susan Li said the company categorizes its AI investments as core AI and generative AI, the latter of which the company does not expect to be "a meaningful driver of revenue" this year.

"We feel like we have a good framework in palace in terms of thinking about where the opportunities are and making sure we have the flexibility to deploy it where it makes the most sense," she said.

Mark Zuckerberg talked through Meta's spending plans

One of Meta's big focuses is "figuring out the right amount of infra" for the AI future, CEO Zuckerberg said on the investor call. Meta is planning the compute clusters and data for the next several years, he said, but it's "hard to predict" how that'll pan out.

But " I'd rather risk building capacity before it's needed rather than too late," he added.

BI chief correspondent Peter Kafka had this takeaway:

"He's justifying AI/GPU spending two ways. One is explicit: 'I'd rather have too much than not enough.' The other is implicit: 'Who else is going to keep up with us, spending-wise?'"

Reality Labs keeps bleeding money

In Q2, Reality Labs, responsible for Meta's work in AR, VR, and the metaverse, had $353 million in revenue and an operating loss of $4.48 billion.

"For Reality Labs, we continue to expect 2024 operating losses to increase meaningfully year-over-year due to our ongoing product development efforts and investments to further scale our ecosystem," the earnings release said.

Meta's earnings and revenue beat should help assuage some investors' concerns for now

"Any apprehensions investors may have had about Meta's spending on AI and the metaverse are likely to be allayed by this quarter's results," said Max Willens, an analyst at Emarketer, a sister company of Business Insider.

"While impression growth has slowed a bit, Meta's careful introduction of ads on Reels has led to a perfect storm of rising impressions and rising ad prices. With its margins as healthy as they are, Meta's investors should feel comfortable with the company's vigorous investments in its plans for the future."

Investors are keeping a close eye on spending in the AI race this earnings season

Meta's total costs and expenses for Q2 were $24.22 billion, up 7% year-over-year.

The company expects its total expenses for the full year to be somewhere between $96 to $99 billion.

The company expects capital expenditures for the full year to be in the range of $37 to $40 billion, higher than its previous range of $35 to $40 billion.

"While we continue to refine our plans for next year, we currently expect significant capital expenditures growth in 2025 as we invest to support our artificial intelligence research and product development efforts," Meta's earnings release said.

Meta beats 2nd-quarter sales and EPS estimates

2nd quarter

Revenue: $39.07 billion, +22% y/y, estimate $38.34 billion

• Advertising revenue: $38.33 billion, +22% y/y, estimate $37.57 billion
• Family of Apps revenue: $38.72 billion, +22% y/y, estimate $37.76 billion
• Reality Labs revenue: $353 million, +28% y/y, estimate $376.9 million
• Other revenue: $389 million, +73% y/y, estimate $344.6 million

Operating income: $14.85 billion, estimate $14.59 billion

• Family of Apps operating income: $19.34 billion, +47% y/y, estimate $18.69 billion
• Reality Labs operating loss: $4.49 billion, +20% y/y, estimate loss $4.53 billion
• Operating margin: 38% vs. 29% y/y, estimate 37.7%
• EPS: $5.16 vs. $2.98 y/y, estimate $4.72
• Ad impressions: +10% vs. +34% y/y, estimate +13%
• Average price per ad: +10% vs. -16% y/y, estimate +5.96%
• Average Family service users per day: 3.27 billion, +6.5% y/y, estimate 3.22 billion

Third quarter

• Revenue: $38.5 billion to $41 billion, estimate $39.16 billion

Full-year 2024

• Capital expenditure: $37 billion to $40 billion, saw $35 billion to $40 billion, estimate $37.53 billion
• Total expenses: $96 billion to $99 billion, estimate $97.73 billion

Meta's consensus second-quarter revenue estimate is $38.34 billion

Revenue estimate: $38.34 billion

• Advertising rev. estimate: $37.57 billion
• Family of Apps revenue estimate: $37.76 billion
• Reality Labs revenue estimate: $376.9 million
• Other revenue estimate: $344.6 million

Operating income estimate: $14.59 billion

• Family of Apps operating income estimate: $18.69 billion
• Reality Labs operating loss estimate: $4.53 billion
• Operating margin estimate: 37.7%
• EPS estimate: $4.74
• Ad impressions estimate: +13%
• Average price per ad estimate: +5.96%
• Average Family service users per day estimate: 3.22 billion
• Revenue estimate: $39.17 billion
• Total expenses estimate: $97.73 billion
• Capital expenditure estimate: $37.57 billion

Meta stock rises roughly 2% ahead of 2nd-quarter earnings report

Meta stock rose about 2.3% in intraday trades on Wednesday, slightly behind the Nasdaq 100's gain of about 2.7%.

Meta stock has been a roller coaster ride for investors this year.

While the stock is up 34% year-to-date, more than double the Nasdaq 100's gain of about 15%, it's down 13% since it hit a record high on July 8 and it experienced a one-day decline of more than 10% after it reported first-quarter earnings in April.

Citi wants to see Meta's big AI investments translate into increased engagement.

A solid advertising environment should help Meta deliver better-than-expected second-quarter earnings and revenue, according to a recent note from Citi.

"Our 2Q advertising checks and time at Cannes suggest that the broader online advertising market is healthy and strengthening," Citi analyst Ronald Josey said.

"We'll be watching for continued engagement benefits from Meta's investments in AI content discovery, adoption of newer monetization tools, early progress from the beta launch of AI studio, potential benefits from Llama 3.1, and profitability. Meta remains our top-pick across our coverage," Josey said.

Citi has a "Buy" rating on Meta with a $550 price target.

Wells Fargo says internal checks point to a solid advertising environment in the second quarter

Wells Fargo raised its second-quarter estimates in a recent note as its internal checks suggests solid ad performance from the company.

"Checks suggest noticeable ad targeting and efficiency improvement in 2Q despite meaningful CPM growth acceleration," Wells Fargo analyst Ken Gawrelski said.

The bank also expects Meta to maintain its prior capital expenditures guidance of $35 billion to $40 billion for the year.

"Given the unfavorable market reaction to 1Q mgmt commentary on potential revenue displacement due to scaling of newer AI products, believe investors will welcome further framing of potential impact," Gawrelski said.

Wells Fargo has an "Overweight" rating on Meta with a $625 price target.

Investors are concerned about Meta's spending plans for AI and the metaverse, Mizuho says

Mizuho said in a recent note that investor concerns about Meta's massive investment cycle has kept Wall Street expectations "in check."

But that means overall expectations may prove to be too conservative.

"We believe risk/reward appears positive on Meta into the print with solid 2Q24 ad agency tracking, achievable 3Q24 expectations, and flexibility in opex to manage raising capex," Mizuho analyst James Lee said.

"At the same time, we view consensus FY24 growth of 17% conservative with improved ad pricing growth from Reels, Amazon's integration into FB shops, and special events revenue growth," Lee added.

Mizuho has an "Outperform" rating on Meta with a $575 price target.

The presidential election should be a boon for Meta's digital advertising, Bloomberg Intelligence says

The upcoming Presidential election and its related advertising spend should benefit Meta in a big away, according to Bloomberg Intelligence analyst Mandeep Singh.

"Meta's impressions and user growth may taper with ad pricing and election-ad spending to be key drivers for surpassing consensus sales growth expectations of 20% in 2Q," Singh said in a recent note.

The company also has the potential to offer guidance on the monetization potential of its licensing of Llama, its open-source large language model.

"Though Meta's positioning remains strong in gen AI, a top-line lift from licensing its Llama model to enterprise customers and adoption of subscription chatbot offerings, similar to OpenAI and Gemini Advanced, will be a key focus on the earnings call," Singh said.

Bank of America says a potential TikTok ban in 2025 could boost Meta's ad platforms

Bank of America said in a recent note that it expects Meta to meet or slightly beat Wall Street's expectations for second-quarter revenue, and beat profit estimates.

"With job openings down in 2Q, we don't anticipate a repeat of last quarter's higher '24 expense guidance, though higher legal and capex are risks," Bank of America analyst Justin Post said.

Looking forward, Post highlighted that a potential TikTok ban in early 2025 could provide a big boost to Meta's advertising business.

"With political spend, and potential TikTok ban in 1Q'25, Meta could also see an ad spend benefit in 2H'24," Post said.

Bank of America has a "Buy" rating on Meta with a $550 price target.

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Facebook (Meta) Q4 2021 Earnings Report Recap

FB missed on earnings but beat on revenue

Key Takeaways

• Monthly active users came in at 2.9 billion, matching analysts' forecasts.
• Facebook (Meta) uses monthly active users to measure the size of its global active user base, which it monetizes through the sale of ad space on its social media platform.
• The company says that cost inflation and supply chain disruptions are having an impact on advertisers' budgets.

Source: Predictions based on analysts' consensus from  Visible Alpha

Facebook (Meta) Financial Results: Analysis

Facebook, which was renamed Meta Platforms, Inc. ( FB ) in late October 2021, reported mixed  Q4 FY 2021 earnings  results on Feb. 2.  Earnings per share  (EPS) missed consensus estimates, down 5.4% from the year-ago quarter. Revenue came in above analyst forecasts, increasing 19.9% year over year (YOY). The Facebook platform's  monthly active users  (MAUs) matched expectations.

FB's Plunging Stock

Meta's  shares fell as much as 25% in after-hours trading on Wednesday evening in response to the company's earnings release, and they were down as much as 24% as of 10:30am EST on Thursday.

Investors' big concern is that Facebook, the world's largest social network, lost daily users for the first time in its history. Facebook lost around 500,000 daily users in the last quarter of 2021, Meta’s quarterly earnings report showed. The losses illustrate how rivals such as TikTok and YouTube are eating into Facebook's growth. Investors also were concerned that Meta is forecasting weaker-than-expected revenue growth for the first quarter. Meta's revenue forecast of $27 billion to $29 billion fell below analyst expectations of $30.2 billion, according to Refinitiv.

FB Monthly Active Users

Meta's MAUs rose 4% compared to the year-ago quarter to reach just over 2.9 billion. MAUs are a key metric Meta uses to gauge the size of the global active user base on its Facebook social media platform. Meta defines MAUs as registered and logged-in users who visited Facebook through its website or a mobile device, or used its Messenger app, sometime during the 30 days of the measurement period.

Meta derives nearly all of its revenue through selling advertising space, based largely on the strength of MAUs, on its social media sites and apps. The bigger its user base, the more attractive its platform is to advertisers. A bigger user base also makes it easier to attract new users, as people want to be on Meta's social media platforms because their friends are on it—a classic example of the  network effect .

FB New Financial Reporting Segment Structure

The fourth quarter was the first quarter for which Meta reported financial results in the following two segments: Family of Apps (FoA), which includes its main social media platform Facebook as well as Instagram, Messenger, WhatsApp, and other services; and Reality Labs (RL), which includes the company's augmented and virtual reality related consumer hardware, software, and content.

Despite the change in the company's name and reporting segment structure, Meta remains primarily a social media company. But the new reporting structure does highlight the new importance the company is putting on augmented and virtual reality, key technologies at the center of the virtual world the company hopes to build named the metaverse .

Meta said that it expects total revenue to be somewhere between $27 billion and $29 billion in the first quarter of FY 2022, reflecting a YOY growth rate of between 3% and 11%. The company expects to face a number of headwinds, including increased competition for people's time, a shift in user engagement to products that generate income at lower rates, various platform and regulatory changes, the impact of cost inflation and supply chain disruptions on advertiser budgets, and other factors.

FB Earnings Call Recap

Chief Executive Officer ( CEO ) Mark Zuckerberg said Meta’s competitor to TikTok, Reels, is growing at a rapid pace. But he added that monetization has been slow, and he asked investors to be patient. “Over time we think that there is potential for a tremendous amount of overall engagement growth” with Reels, he said on a conference call after earnings were released. “We think it’s definitely the right thing to lean into this and push as hard to grow Reels as quickly as possible and not hold on the brakes at all, even though it may create some near-term slower growth than we would have wanted."

Meta's next earnings report (for Q1 FY 2022) is estimated to be released on April 26, 2022.

Meta Platforms, Inc. " Meta Reports Fourth Quarter and Full Year 2021 Results ." Accessed Feb. 2, 2022.

Visible Alpha. " Financial Data ." Accessed Jan. 31, 2022.

CNBC. " Facebook shares plummet 25% after reporting weak guidance ." Accessed Feb. 3, 2022.

Yahoo! Finance. " Facebook (Meta) Stock ." Accessed Feb. 3, 2022.

Forbes. " Facebook Loses Daily Active Users For The First Time – Here’s Where They're Going ." Accessed Feb. 3, 2022.

Meta Platforms Inc. " Form 10-K for the Fiscal Year Ended December 31, 2020 ," Page 55. Accessed Feb. 1, 2022.

Bloomberg. " Meta’s Shares Collapse After TikTok Steals Users From Facebook ." Accessed Feb. 3, 2022.

Yahoo! Finance. " Earnings Calendar: FB ." Accessed Feb. 1, 2022.

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Meta Posts 23% Growth as Ads Rebound, With Profit More Than Doubling

The internet company’s cost cuts also helped lift its financial performance in the most recent quarter.

By Mike Isaac

Mike Isaac has covered Meta’s quarterly earnings since the company went public in 2012.

Mark Zuckerberg, Meta’s chief executive, spent the past two years weathering a slump in digital advertising and cutting costs . This year, he proclaimed, would be a “year of efficiency” for his company.

Some fruits of those labors are now beginning to show.

Meta, which owns Facebook, Instagram, WhatsApp and Messenger, reported on Wednesday that revenue rose 23 percent to $34.15 billion in the third quarter, above Wall Street estimates of $33.6 billion, according to data compiled by FactSet. Profit was $11.6 billion, more than double the $4.4 billion from a year earlier.

Meta’s growth was bolstered by a rebound in digital ads, which has also fueled the financial performance of other companies. On Tuesday, Google reported increased ad sales, with Snap also disclosing rising sales after revenue declined for two quarters.

But Meta’s results were also helped by its cost cuts, as expenses fell 7 percent from a year earlier to $20.4 billion.

The results underscored Meta’s resilience amid a tumultuous few years for Silicon Valley. The company saw record profit and user growth in the early days of the pandemic, as people were forced indoors and connected through their devices and apps. But the easing of the pandemic, combined with higher interest rates and global economic uncertainty, later hit Meta. The company reduced its work force by roughly a third and flattened its organizational structure.

“The company may be starting to come out of the woods as the Mark Zuckerberg-led company continues to focus on improving operating efficiency,” said Jesse Cohen, senior analyst at Investing.com.

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Facebook Reports Third Quarter 2021 Results

Announces New Financial Reporting Segment Structure Beginning in Fourth Quarter 2021

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Oct 25, 2021, 16:05 ET

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MENLO PARK, Calif. , Oct. 25, 2021 /PRNewswire/ -- Facebook, Inc. (Nasdaq: FB ) today reported financial results for the quarter ended September 30, 2021.

"We made good progress this quarter and our community continues to grow," said Mark Zuckerberg , Facebook founder and CEO. "I'm excited about our roadmap, especially around creators, commerce, and helping to build the metaverse."

Third Quarter 2021 Financial Highlights

Third Quarter 2021 Operational and Other Financial Highlights

• Facebook daily active users (DAUs)  – DAUs were 1.93 billion on average for September 2021 , an increase of 6% year-over-year.
• Facebook monthly active users (MAUs)  – MAUs were 2.91 billion as of September 30, 2021, an increase of 6% year-over-year.
• Family daily active people (DAP)  – DAP was 2.81 billion on average for September 2021 , an increase of 11% year-over-year.
• Family monthly active people (MAP) – MAP was 3.58 billion as of September 30, 2021, an increase of 12% year-over-year.
• Capital expenditures – Capital expenditures, including principal payments on finance leases, were $4 .54 billion for the third quarter of 2021.
• Share repurchases – We repurchased $14.37 billion of our Class A common stock in the third quarter and had $7.97 billion remaining on our prior share repurchase authorization as of September 30, 2021 . We also announced today a $50 billion increase in our share repurchase authorization.
• Cash and cash equivalents and marketable securities  – Cash and cash equivalents and marketable securities were $58 .08 billion as of September 30, 2021.
• Headcount – Headcount was 68,177 as of September 30, 2021, an increase of 20% year-over-year.

CFO Outlook Commentary

Starting with our results for the fourth quarter of 2021, we plan to break out Facebook Reality Labs, or FRL, as a separate reporting segment. As we have discussed, we are dedicating significant resources toward our augmented and virtual reality products and services, which are an important part of our work to develop the next generation of online social experiences. The new segment disclosures will provide additional information on the performance of FRL and the investments we are making.

Under this reporting structure, we will provide revenue and operating profit for two segments: The first segment, Family of Apps, will include Facebook, Instagram, Messenger, WhatsApp and other services. The second segment, Facebook Reality Labs, will include augmented and virtual reality related hardware, software and content. We expect our investment in Facebook Reality Labs to reduce our overall operating profit in 2021 by approximately $10 billion . We are committed to bringing this long-term vision to life and we expect to increase our investments for the next several years.

Ahead of the fourth quarter earnings call, we will share additional details about the reporting format of our segmented financials.

We expect fourth quarter 2021 total revenue to be in a range of $31.5 billion to $34 billion . Our outlook reflects the significant uncertainty we face in the fourth quarter in light of continued headwinds from Apple's iOS 14 changes, and macroeconomic and COVID-related factors. In addition, we expect non-ads revenue to be down year-over-year in the fourth quarter as we lap the strong launch of Quest 2 during last year's holiday shopping season.

As previously noted, we also continue to monitor developments regarding the viability of transatlantic data transfers and their potential impact on our European operations.

We expect 2021 total expenses to be in the range of $70 -71 billion, updated from our prior outlook of $70 -73 billion. We anticipate our full-year 2022 total expenses will be in the range of $91 -97 billion, driven by investments in technical and product talent and infrastructure-related costs.

We expect 2021 capital expenditures to be approximately $19 billion , updated from our prior estimate of $19 -21 billion. For 2022, we expect capital expenditures to be in the range of $29 -34 billion, driven by our investments in data centers, servers, network infrastructure, and office facilities.

We expect our fourth quarter 2021 tax rate to be in the high-teens. Absent any changes to U.S. tax law, we would expect our full-year tax rate in 2022 to be similar to the full-year 2021 rate.

Please note that our outlook for 2022 expenses, capital expenditures and tax rate are preliminary estimates as we have not finalized our 2022 budget.

New Financial Reporting Segment Structure

Beginning in the fourth quarter of 2021, we will implement a new financial reporting segment structure with the following two reportable segments:

• Family of Apps (FoA) , which includes Facebook, Instagram, Messenger, WhatsApp and other services.
• Facebook Reality Labs (FRL) , which includes augmented and virtual reality related consumer hardware, software and content.

Webcast and Conference Call Information

Facebook will host a conference call to discuss the results at 2 p.m. PT / 5 p.m. ET today. The live webcast of Facebook's earnings conference call can be accessed at investor.fb.com , along with the earnings press release, financial tables, and slide presentation. Facebook uses the investor.fb.com and about.fb.com/news/ websites as well as Mark Zuckerberg's Facebook Page ( https://www.facebook.com/zuck ) and Instagram account ( https://www.instagram.com/zuck ) as means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD.

Following the call, a replay will be available at the same website. A telephonic replay will be available for one week following the conference call at +1 (402) 977-9140 or +1 (800) 633-8284, conference ID 21997795.

Transcripts of conference calls with publishing equity research analysts held today will also be posted to the investor.fb.com website.

About Facebook

Founded in 2004, Facebook's mission is to give people the power to build community and bring the world closer together. People use Facebook's apps and technologies to connect with friends and family, find communities and grow businesses.

Investors: Deborah Crawford [email protected]  / investor.fb.com

Press: Ryan Moore [email protected]  / about.fb.com/news/

Forward-Looking Statements

This press release contains forward-looking statements regarding our future business plans and expectations. These forward-looking statements are only predictions and may differ materially from actual results due to a variety of factors including: the impact of the COVID-19 pandemic on our business and financial results; our ability to retain or increase users and engagement levels; our reliance on advertising revenue; our dependency on data signals and mobile operating systems, networks, and standards that we do not control; risks associated with new products and changes to existing products as well as other new business initiatives; our emphasis on community growth and engagement and the user experience over short-term financial results; maintaining and enhancing our brand and reputation; our ongoing privacy, safety, security, and content review efforts; competition; risks associated with government actions that could restrict access to our products or impair our ability to sell advertising in certain countries; litigation and government inquiries; privacy and regulatory concerns; risks associated with acquisitions; security breaches; and our ability to manage growth and geographically-dispersed operations. These and other potential risks and uncertainties that could cause actual results to differ from the results predicted are more fully detailed under the caption "Risk Factors" in our Quarterly Report on Form 10-Q filed with the SEC on July 29, 2021 , which is available on our Investor Relations website at investor.fb.com and on the SEC website at www.sec.gov . Additional information will also be set forth in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2021. In addition, please note that the date of this press release is October 25, 2021, and any forward-looking statements contained herein are based on assumptions that we believe to be reasonable as of this date. We undertake no obligation to update these statements as a result of new information or future events.

Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States (GAAP), we use the following non-GAAP financial measures: revenue excluding foreign exchange effect, advertising revenue excluding foreign exchange effect and free cash flow. The presentation of these financial measures is not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. Investors are cautioned that there are material limitations associated with the use of non-GAAP financial measures as an analytical tool. In addition, these measures may be different from non-GAAP financial measures used by other companies, limiting their usefulness for comparison purposes. We compensate for these limitations by providing specific information regarding the GAAP amounts excluded from these non-GAAP financial measures.

We believe these non-GAAP financial measures provide investors with useful supplemental information about the financial performance of our business, enable comparison of financial results between periods where certain items may vary independent of business performance, and allow for greater transparency with respect to key metrics used by management in operating our business.

We exclude the following items from our non-GAAP financial measures:

Foreign exchange effect on revenue . We translated revenue for the three and nine months ended September 30, 2021 using the prior year's monthly exchange rates for our settlement or billing currencies other than the U.S. dollar, which we believe is a useful metric that facilitates comparison to our historical performance.

Purchases of property and equipment; Principal payments on finance leases.  We subtract both purchases of property and equipment and principal payments on finance leases in our calculation of free cash flow because we believe that these two items collectively represent the amount of property and equipment we need to procure to support our business, regardless of whether we procure such property or equipment with a finance lease. We believe that this methodology can provide useful supplemental information to help investors better understand underlying trends in our business. Free cash flow is not intended to represent our residual cash flow available for discretionary expenditures.

For more information on our non-GAAP financial measures and a reconciliation of GAAP to non-GAAP measures, please see the "Reconciliation of GAAP to Non-GAAP Results" table in this press release.

SOURCE Facebook

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