Meta Reports Second Quarter 2024 Results

July 31, 2024

MENLO PARK, Calif., July 31, 2024 /PRNewswire/ -- Meta Platforms, Inc. (Nasdaq: META) today reported financial results for the quarter ended June 30, 2024.

"We had a strong quarter, and Meta AI is on track to be the most used AI assistant in the world by the end of the year," said Mark Zuckerberg, Meta founder and CEO. "We've released the first frontier-level open source AI model, we continue to see good traction with our Ray-Ban Meta AI glasses, and we're driving good growth across our apps."

 Second Quarter 2024 Financial Highlights


Three Months Ended June 30,


 % Change

In millions, except percentages and per share amounts               

2024


2023


Revenue

$                  39,071


$                  31,999


22 %

Costs and expenses

24,224


22,607


7 %

Income from operations

$                  14,847


$                    9,392


58 %

Operating margin

38 %


29 %



Provision for income taxes

$                    1,641


$                    1,505


9 %

Effective tax rate

11 %


16 %



Net income

$                  13,465


$                    7,788


73 %

Diluted earnings per share (EPS)

$                      5.16


$                      2.98


73 %

 

 Second Quarter 2024 Operational and Other Financial Highlights

  • Family daily active people (DAP) – DAP was 3.27 billion on average for June 2024, an increase of 7% year-over-year.
  • Ad impressions – Ad impressions delivered across our Family of Apps increased by 10% year-over-year.
  • Average price per ad – Average price per ad increased by 10% year-over-year.
  • Revenue – Total revenue was $39.07 billion, an increase of 22% year-over-year. Revenue on a constant currency basis would have increased 23% year-over-year.
  • Costs and expenses – Total costs and expenses were $24.22 billion, an increase of 7% year-over-year.
  • Capital expenditures – Capital expenditures, including principal payments on finance leases, were $8.47 billion.
  • Capital return program – Share repurchases were $6.32 billion of our Class A common stock and dividend payments were $1.27 billion.
  • Cash, cash equivalents, and marketable securities – Cash, cash equivalents, and marketable securities were $58.08 billion as of June 30, 2024. Free cash flow was $10.90 billion.
  • Headcount – Headcount was 70,799 as of June 30, 2024, a decrease of 1% year-over-year.


CFO Outlook Commentary

We expect third quarter 2024 total revenue to be in the range of $38.5-41 billion. Our guidance assumes foreign currency is a 2% headwind to year-over-year total revenue growth, based on current exchange rates.

We expect full-year 2024 total expenses to be in the range of $96-99 billion, unchanged from our prior outlook. 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.

While we do not intend to provide any quantitative guidance for 2025 until the fourth quarter call, we expect infrastructure costs will be a significant driver of expense growth next year as we recognize depreciation and operating costs associated with our expanded infrastructure footprint.

We anticipate our full-year 2024 capital expenditures will be in the range of $37-40 billion, updated from our prior range of $35-40 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.

Absent any changes to our tax landscape, we expect our full-year 2024 tax rate to be in the mid-teens.

In addition, we continue to monitor an active regulatory landscape, including the increasing legal and regulatory headwinds in the EU and the U.S. that could significantly impact our business and our financial results.


Webcast and Conference Call Information

Meta will host a conference call to discuss the results at 2:00 p.m. PT / 5:00 p.m. ET today. The live webcast of Meta's earnings conference call can be accessed at the Meta Investor Relations website at investor.fb.com, along with the earnings press release, financial tables, and slide presentation. 

Following the call, a replay will be available at the same website. Transcripts of conference calls with publishing equity research analysts held today will also be posted to the investor.fb.com website.

Disclosure Information

Meta uses the investor.fb.com and about.fb.com/news/ websites as well as Mark Zuckerberg's Facebook Page (facebook.com/zuck), Instagram account (instagram.com/zuck) and Threads profile (threads.net/zuck) as means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD.

About Meta

Meta builds technologies that help people connect, find communities, and grow businesses. When Facebook launched in 2004, it changed the way people connect. Apps like Messenger, Instagram, and WhatsApp further empowered billions around the world. Now, Meta is moving beyond 2D screens toward immersive experiences like augmented and virtual reality to help build the next evolution in social technology.

Contacts

Investors:
Kenneth Dorell
investor@meta.com / investor.fb.com

Press:
Ryan Moore
press@meta.com / 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 macroeconomic conditions on our business and financial results, including as a result of geopolitical events; 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; changes to the content or application of third-party policies that impact our advertising practices; risks associated with new products and changes to existing products as well as other new business initiatives, including our artificial intelligence initiatives and metaverse efforts; 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, legislative, and regulatory concerns or developments; risks associated with acquisitions; security breaches; our ability to manage our scale and geographically-dispersed operations; and market conditions or other factors affecting the payment of dividends. 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 April 25, 2024, 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 June 30, 2024. In addition, please note that the date of this press release is July 31, 2024, 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.

For a discussion of limitations in the measurement of certain of our community metrics, see the section entitled "Limitations of Key Metrics and Other Data" in our most recent quarterly or annual report filed with the SEC.

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.

Our non-GAAP financial measures are adjusted for the following items:

Foreign exchange effect on revenue. We translated revenue for the three and six months ended June 30, 2024 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, net of proceeds 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.

 

META PLATFORMS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In millions, except per share amounts)

(Unaudited)


Three Months Ended June 30,


Six Months Ended June 30,


2024


2023


2024


2023

Revenue

$           39,071


$           31,999


$           75,527


$           60,645

Costs and expenses:








Cost of revenue

7,308


5,945


13,948


12,054

Research and development

10,537


9,344


20,515


18,725

Marketing and sales

2,721


3,154


5,285


6,198

General and administrative (1)

3,658


4,164


7,114


7,049

Total costs and expenses

24,224


22,607


46,862


44,026

Income from operations

14,847


9,392


28,665


16,619

Interest and other income (expense), net

259


(99)


624


(19)

Income before provision for income taxes

15,106


9,293


29,289


16,600

Provision for income taxes

1,641


1,505


3,455


3,102

Net income

$           13,465


$              7,788


$           25,834


$           13,498

Earnings per share:








Basic

$               5.31


$                3.03


$             10.17


$               5.24

Diluted

$               5.16


$                2.98


$               9.86


$               5.18

Weighted-average shares used to compute earnings per share:   








Basic

2,534


2,568


2,540


2,577

Diluted

2,610


2,612


2,619


2,604






(1) The second quarter 2024 general and administrative expenses include a charge for the recent settlement with the State of Texas. The settlement amount is fully accrued as of June 30, 2024.

 

META PLATFORMS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions)

(Unaudited)


June 30, 2024


December 31, 2023

Assets




Current assets:




Cash and cash equivalents

$                  32,045


$                  41,862

Marketable securities

26,035


23,541

Accounts receivable, net

14,505


16,169

Prepaid expenses and other current assets                            

3,846


3,793

Total current assets

76,431


85,365

Non-marketable equity securities

6,207


6,141

Property and equipment, net

102,959


96,587

Operating lease right-of-use assets

14,058


13,294

Goodwill

20,654


20,654

Other assets

9,929


7,582

Total assets

$                230,238


$                229,623





Liabilities and stockholders' equity




Current liabilities:




Accounts payable

$                    3,173


$                    4,849

Operating lease liabilities, current

1,917


1,623

Accrued expenses and other current liabilities                                                 

21,914


25,488

Total current liabilities

27,004


31,960

Operating lease liabilities, non-current

17,685


17,226

Long-term debt

18,389


18,385

Long-term income taxes

7,897


7,514

Other liabilities

2,500


1,370

Total liabilities

73,475


76,455

Commitments and contingencies




Stockholders' equity:




Common stock and additional paid-in capital

78,270


73,253

Accumulated other comprehensive loss

(2,695)


(2,155)

Retained earnings

81,188


82,070

Total stockholders' equity

156,763


153,168

Total liabilities and stockholders' equity

$                230,238


$                229,623

 

META PLATFORMS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)


Three Months Ended June 30,


Six Months Ended June 30,


2024


2023


2024


2023

Cash flows from operating activities








Net income

$      13,465


$        7,788


$      25,834


$      13,498

Adjustments to reconcile net income to net cash provided by operating activities:








Depreciation and amortization

3,637


2,623


7,011


5,147

Share-based compensation

4,616


4,060


8,178


7,111

Deferred income taxes

(1,643)


(1,137)


(2,098)


(1,757)

Impairment charges for facilities consolidation, net

41


232


280


1,002

Other

(6)


212


(71)


204

Changes in assets and liabilities:








Accounts receivable

(1,171)


(1,424)


1,350


1,122

Prepaid expenses and other current assets

(84)


(54)


16


767

Other assets

54


37


(41)


67

Accounts payable

250


(51)


(862)


(1,155)

Accrued expenses and other current liabilities

(497)


5,174


(1,771)


5,268

Other liabilities

708


(151)


790


33

Net cash provided by operating activities

19,370


17,309


38,616


31,307

Cash flows from investing activities








Purchases of property and equipment, net

(8,173)


(6,134)


(14,573)


(12,957)

Purchases of marketable debt securities

(3,289)


(717)


(10,176)


(803)

Sales and maturities of marketable debt securities

3,233


1,816


7,858


2,351

Acquisitions of businesses and intangible assets

(57)


(83)


(129)


(527)

Other investing activities

(12)


(85)


(12)


(10)

Net cash used in investing activities

(8,298)


(5,203)


(17,032)


(11,946)

Cash flows from financing activities








Taxes paid related to net share settlement of equity awards

(3,208)


(1,692)


(6,370)


(2,701)

Repurchases of Class A common stock

(6,299)


(898)


(21,307)


(10,263)

Dividend payments

(1,266)



(2,539)


Proceeds from issuance of long-term debt, net


8,455



8,455

Principal payments on finance leases

(299)


(220)


(614)


(484)

Other financing activities

(106)


(353)


(115)


(231)

Net cash provided by (used in) financing activities

(11,178)


5,292


(30,945)


(5,224)

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

(152)


(14)


(440)


71

Net increase (decrease) in cash, cash equivalents, and restricted cash

(258)


17,384


(9,801)


14,208

Cash, cash equivalents, and restricted cash at beginning of the period

33,284


12,420


42,827


15,596

Cash, cash equivalents, and restricted cash at end of the period

$      33,026


$      29,804


$      33,026


$      29,804









Reconciliation of cash, cash equivalents, and restricted cash to the
condensed consolidated balance sheets








Cash and cash equivalents

$      32,045


$      28,785


$      32,045


$      28,785

Restricted cash, included in prepaid expenses and other current assets

100


165


100


165

Restricted cash, included in other assets

881


854


881


854

Total cash, cash equivalents, and restricted cash

$      33,026


$      29,804


$      33,026


$      29,804

 

META PLATFORMS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)


Three Months Ended June 30,


Six Months Ended June 30,


2024


2023


2024


2023

Supplemental cash flow data








Cash paid for income taxes, net

$        5,929


$        1,102


$        6,559


$        1,507

Cash paid for interest, net of amounts capitalized

$           124


$             —


$           245


$           182

Non-cash investing and financing activities:








Property and equipment in accounts payable and accrued expenses and other
current liabilities

$        3,229


$        3,845


$        3,229


$        3,845

Acquisition of businesses and intangible assets in accrued expenses and
other current liabilities and other liabilities

$           267


$           217


$           267


$           217

 

Segment Results

We report our financial results for our two reportable segments: Family of Apps (FoA) and Reality Labs (RL). FoA includes Facebook, Instagram, Messenger, WhatsApp, and other services. RL includes our virtual, augmented, and mixed reality related consumer hardware, software, and content.

The following table presents our segment information of revenue and income (loss) from operations:

Segment Information

(In millions)

(Unaudited)


Three Months Ended June 30,



Six Months Ended June 30,


2024



2023



2024



2023

Revenue:











Advertising

$      38,329



$      31,498



$     73,965



$     59,599

Other revenue

389



225



769



430

Family of Apps

38,718



31,723



74,734



60,029

Reality Labs

353



276



793



616

Total revenue

$      39,071



$      31,999



$     75,527



$     60,645












Income (loss) from operations:











Family of Apps

$      19,335



$      13,131



$     36,999



$     24,351

Reality Labs

(4,488)



(3,739)



(8,334)



(7,732)

Total income from operations                                           

$      14,847



$        9,392



$     28,665



$     16,619

 

Reconciliation of GAAP to Non-GAAP Results

(In millions, except percentages)

(Unaudited)


Three Months Ended June 30,


Six Months Ended June 30,


2024


2023


2024


2023

GAAP revenue

$      39,071


$      31,999


$      75,527


$       60,645

Foreign exchange effect on 2024 revenue using 2023 rates

371




265



Revenue excluding foreign exchange effect

$      39,442




$      75,792



GAAP revenue year-over-year change %

22 %




25 %



Revenue excluding foreign exchange effect year-over-year change %

23 %




25 %



GAAP advertising revenue

$      38,329


$      31,498


$      73,965


$       59,599

Foreign exchange effect on 2024 advertising revenue using 2023 rates             

367




261



Advertising revenue excluding foreign exchange effect

$      38,696




$      74,226



GAAP advertising revenue year-over-year change %

22 %




24 %



Advertising revenue excluding foreign exchange effect year-over-year
change %

23 %




25 %











Net cash provided by operating activities

$      19,370


$      17,309


$      38,616


$       31,307

Purchases of property and equipment, net

(8,173)


(6,134)


(14,573)


(12,957)

Principal payments on finance leases

(299)


(220)


(614)


(484)

Free cash flow

$      10,898


$      10,955


$      23,429


$       17,866

 

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