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Meta Platforms:Quarterly Results/2023 Q4: Difference between revisions
Meta Platforms:Quarterly Results/2023 Q4 (view source)
Revision as of 13:29, 2 February 2024
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== Summary of the earnings call == | == Summary of the earnings call == | ||
Here is a summary of Meta Q4 2023 earnings call<ref>https://s21.q4cdn.com/399680738/files/doc_financials/2023/q4/META-Q4-2023-Earnings-Call-Transcript.pdf</ref>; | |||
=== AI Products === | === AI Products === | ||
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* Zuckerberg said they are rolling out Meta AI, AI Studio and Ray-Ban Meta smart glasses more widely in the coming months but monetization normally starts once they reach hundreds of millions or billions of people. | * Zuckerberg said they are rolling out Meta AI, AI Studio and Ray-Ban Meta smart glasses more widely in the coming months but monetization normally starts once they reach hundreds of millions or billions of people. | ||
* In 2024, they will focus on launching Llama 3, expanding the usefulness of Meta AI Assistant and making progress on AI Studio. | * In 2024, they will focus on launching Llama 3, expanding the usefulness of Meta AI Assistant and making progress on AI Studio. | ||
* Zuckerberg said FAIR is focused on longer-term work while GenAI is focused on immediate work. | |||
* Don't expect GenAI products to be a meaningful driver of revenue in 2024 (Q&A). | |||
* Meta AI is at a phase where they are not pushing it super proactively (Q&A). | |||
=== Advertising Business === | === Advertising Business === | ||
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* '''In Q4, ad impressions grew by 21% driven by Asia-Pacific and Rest of World while the average price per ad increased by 2% " driven by advertiser demand and currency tailwinds, which were partially offset by strong impression growth, particularly from lower-monetizing surfaces and regions."''' | * '''In Q4, ad impressions grew by 21% driven by Asia-Pacific and Rest of World while the average price per ad increased by 2% " driven by advertiser demand and currency tailwinds, which were partially offset by strong impression growth, particularly from lower-monetizing surfaces and regions."''' | ||
* Click to message ads seeing greater demand. | * Click to message ads seeing greater demand. | ||
* Shop ads crossed a $2 billion annual run-rate in Q4. | * '''Shop ads crossed a $2 billion annual run-rate in Q4'''. | ||
* Lee said they are getting strong feedback from advertisers on features such as Advantage+ Shopping, Advantage+ Catalog, Advantage+ Creative, Advantage+ Audiences, etc. They are also getting good feedback on tools that report on ad performance (Q&A). | * Lee said they are getting strong feedback from advertisers on features such as Advantage+ Shopping, Advantage+ Catalog, Advantage+ Creative, Advantage+ Audiences, etc. They are also getting good feedback on tools that report on ad performance (Q&A). | ||
* Concerning Shop ads, they partnered with Amazon to make purchases of products online. But the test is still in the early days (Q&A) | * Concerning Shop ads, they partnered with Amazon to make purchases of products online. But the test is still in the early days (Q&A). | ||
* '''Ad creative tools are their most near-term monetization opportunity eg Text Variations and Image Expansion''' (Q&A). | |||
=== Q1 and Full-year 2024 Guidance === | === Q1 and Full-year 2024 Guidance === | ||
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* '''CFO Susan Lee said their Q1 guidance is based on strong advertising trends that they are seeing as well as accruing benefits from their ad performance investments.''' "On your second question, which is about the Q1 year-over-year -- sorry, the Q1 revenue guide. This really just reflects a lot of the trends we saw in Q4, which is strong, broad-based advertising demand across verticals, particularly within online commerce and gaming. I'll also note that we get the benefit from having February 29th in this quarter. And again, just the improvements that we continue to accrue to the business from all of our investments in improving ad performance over time," she said. | * '''CFO Susan Lee said their Q1 guidance is based on strong advertising trends that they are seeing as well as accruing benefits from their ad performance investments.''' "On your second question, which is about the Q1 year-over-year -- sorry, the Q1 revenue guide. This really just reflects a lot of the trends we saw in Q4, which is strong, broad-based advertising demand across verticals, particularly within online commerce and gaming. I'll also note that we get the benefit from having February 29th in this quarter. And again, just the improvements that we continue to accrue to the business from all of our investments in improving ad performance over time," she said. | ||
* Their increased capex guidance reflects their evolving understanding of how much AI infrastructure they may need. It is also an insurance on supply situation (Q&A). | * Their increased capex guidance reflects their evolving understanding of how much AI infrastructure they may need. It is also an insurance on supply situation (Q&A). | ||
* Lee said 2024 revenue will be influenced by a number of factors including macro and lapping of strong periods. "But our revenue for the full year is going to be influenced by a number of factors, including macro conditions that are certainly harder to predict the further out you go. And over the course of 2024, as you said, we'll also be lapping periods of increasingly strong demand. So we don't provide guidance beyond Q1. There's certainly a range of outcomes, and we'll have a better read on how we will compare to future quarters as we progress through the year," she said (Q&A). | |||
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* Expect to maintain an active share repurchase program but will start giving out dividends. | * Expect to maintain an active share repurchase program but will start giving out dividends. | ||
* Lee said share repurchase will continue to be the primary way that they return capital to shareholders but dividends serve as a nice compliment to it. '''"We expect that share repurchases will continue to be the primary way that we return capital to shareholders. But introducing a dividend just gives us a more balanced capital return program and some added flexibility in how we return capital in the future," She said (Q&A).''' | |||
=== Regulatory Environment === | === Regulatory Environment === | ||
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* Daily watch time across Reels and overall video rose by 25% y/y in Q4, driven by ongoing ranking improvements. | * Daily watch time across Reels and overall video rose by 25% y/y in Q4, driven by ongoing ranking improvements. | ||
* WhatsApp Channels now has 500 million active users since rolling out worlwide in September. | * WhatsApp Channels now has 500 million active users since rolling out worlwide in September. | ||
=== Apple Changes === | |||
* Apple changes won't have a difference to Meta. "I don't think that the Apple thing is going to have any difference for us because I think that the way that they've implemented it, I would be very surprised if any developer chose to go into the alternative app stores that they have," Zuckerberg said (Q&A). | |||
=== Year of Efficiency === | === Year of Efficiency === | ||