Meta shares fell more than 22% on falling profits

Meta Platforms, the parent company of Facebook, dropped more than 22 percent after the release of its quarterly earnings.

In extended trading on the NASDAQ exchange, the company's stock had fallen to $249 per share by 10:23 a.m. Moscow time, down 22.89 percent from its close on Wednesday, Feb. 2. If the fall is not corrected before the beginning of the main session, the capitalization of Meta could decrease by $175 billion.

Following the collapse of Meta shares began to decline and quotes of other operators of social networks. Thus, shares of Snap on the postmarket fell by 17%, Pinterest - by 9.4%, Twitter - about 8%.

The day before, Meta published its first financial report after the rebranding, which fell short of analysts' expectations. Despite a 20% increase in revenue in the fourth quarter of 2021 from $28 billion to $33.67 billion, the company's net income decreased by 8% compared to the same period in 2020. (from $11.22 billion to $10.28 billion). Earnings per share fell 5% to $3.67 versus an expected $3.84, according to the Refinitiv consensus forecast.

In addition, the number of daily active Facebook users declined slightly in the fourth quarter (by 1 million people) compared to the previous quarter - the first time in the social network's history.

Meta expects revenue in Q1 this year to be between $27 billion and $29 billion, while analysts had forecast sales of $30.15 billion, according to Refinitiv. On a year-over-year basis, that figure would increase by 3 to 11% and could be the slowest quarterly growth in the company's history. Analysts had expected about 15% growth. Meta is also forecasting significant cost growth in 2021. (to $95 billion versus $71.17 billion a year earlier).

Revenue will grow more slowly in Q1, according to Meta's forecast, due to inflation, supply chain disruptions at advertisers, and Apple's new privacy policy.

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