Meta shared the current report about the drop in its profit due to reduction in users and risks to its ad business. Facebook parent firm, Meta faced the dwindling market and decreasing consumer trust. Other companies are also facing pandemic effects by viewing sharp decline is its users. In midst 2021, Facebook started losing 1 million users from all over the globe. This figure started haunting the giant firm Facebook having 2 billion regular users.
CFO Dave Weiner shared reasons with analyst related to non-uniform growth in Asia and increased price of internet bundles in India. He also highlighted the negative effect of competition on growth of companies specifically in younger viewers. The company top officials regularly claimed the competition from other social media apps like Tik Tok.
The number of daily active users on the Facebook estimated by experts is 1.95 billion, while Meta’s analysis report indicated 1.93 billion. Estimation of daily active users is the indicator of progress for the firms which are used by customers for communication.
The financial picture also displayed the decline in profit. The net turnover achieved by Meta is $33 billion while net profit decreased by the eight percent in last quarter in compared to previous year. Meta notified the reasons of this unsatisfactory role by listing the competition as the main reason for it. In addition to competition, consumers and advertisers faced supply chain problems in ad business. Rule implemented by Apple on ad targeting had also displayed negative impact to social media apps. Apps like Meta completely rely on the ad targeting which is limited by Apple. According to December 31, 2021 stats, people using one of its four platform was 2.8 billion and 3.6 billion at least in a month.
Metaverse Cost
It is first report published by the Meta after changing its name. The most significant crisis of the Silicon Valley in last year revealed the priorities of officials committed to growth in contrast to keeping the users safe. Ex-employee Frances Haugen leaked the internal papers about the long-deadlocked regulation struggle. Then US lawmakers thoroughly looked into the matter. Meta is investing heavily to bring evolution through metaverse in the world of internet to change the perception of people. It will take the customers into scientific fiction based on augmented reality glasses and virtual reality headsets. However, it is the multibillion dollars project in Facebook Reality Labs branch without any long-term paybacks.
“There's a lot of uncertainty about Meta's investments in the metaverse and if or when they will have a positive impact on the company's bottom line,” said analyst Debra Aho Williamson.
Source:
https://www.dawn.com/news/1673059/metas-profit-slips-as-facebook-says-its-losing-1m-users-daily