Facebook shares spike on better-than-expected quarterly earnings

Meta, the company formerly known as Facebook, is set to report first-quarter earnings after the bell on Wednesday.

Here are the key numbers:

• Earnings per share: $2.56 expected, according to a Refinitiv survey of analysts
• Revenue: $28.2 billion expected, according to Refinitiv
• Daily Active Users (DAUs): 1.95 billion expected, according to StreetAccount
• Monthly Active Users (MAUs): 2.97 billion expected, according to StreetAccount
• Average Revenue per User (ARPU): $9.50 expected, according to StreetAccount

Meta is updating investors for the first time since a brutal fourth-quarter earnings report in February sent the stock down 26%, its worst day ever. Daily active users declined for the first time and the company forecast weaker-than-expected growth.

First-quarter results should shed light on how macroeconomic trends like inflation and the war in Ukraine may be impacting ad spending on the platform. Growth is expected to come in at 7.8%, slipping into the single digits for the first time in Facebook’s 10-year history as a public company.

In Snap‘s earnings last week, CEO Evan Spiegel said the period “proved more challenging than we had expected.” Alphabet followed with disappointing numbers on Tuesday, largely attributable to weak ad spend on YouTube.

Analysts will also be watching to see how Facebook is navigating Apple’s new app transparency rules, which Meta CFO Dave Wehner said last quarter would result in a $10 billion revenue hit this year.

Wehner told analysts on the company’s earnings call at the time that the figure was an estimate of the overall impact of the iOS changes on 2022 revenue.

“We can’t be precise on this. It’s an estimate,” he acknowledged, adding that the company believes the impact will be “substantial.”

With the stock down almost 50% this year, Meta’s guidance will be of particular importance to investors looking for signs of optimism. Second-quarter growth is expected to slow to 5.3%, according to analysts polled by Refinitiv, resulting in revenue of $30.6 billion. That’s down from 56% a year earlier.

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