variety.com
03.02.2022 / 00:35
Facebook Parent Company Meta Stock Plummets on Warning of Q1 Ad Slowdown
Todd Spangler NY Digital EditorMeta, Facebook’s parent company, forecast slower growth in the first quarter of 2022, citing “headwinds to both impression and price growth” in its ad business, sending the stock into a nosedive.In addition, CEO Mark Zuckerberg’s high-stakes gambit to turn Facebook into a “metaverse” company — burning billions of dollars — led to a rare earnings miss for the company in Q4.Meta’s stock dropped more than 22% in after-hours trading.In the current quarter, “On the impressions side, we expect continued headwinds from both increased competition for people’s time and a shift of engagement within our apps towards video surfaces like Reels, which monetize at lower rates than Feed and Stories,” the company said in announcing Q4 2021 results. On the ad pricing side, growth will be hurt by several factors, including greater impact from Apple’s iOS privacy changes and “we anticipate modestly increasing ad targeting and measurement headwinds from platform and regulatory changes,” Meta said.Click here to sign up for Variety’s free Strictly Business newsletter covering earnings, financial news, and more.For the fourth quarter of 2021, Meta reported ad revenue of $32.64 for its core social apps, including Facebook and Instagram, an increase of 20%.