Meta's "year of efficiency" seems to be paying off.
The Facebook-parent company on Wednesday reported revenue of $32 billion for its quarter ending in June, marking an 11% increase compared to the same period last year and beating Wall Street's expectations. The results mark Meta's second consecutive quarter of revenue growth after a brutal 2022, which was notable for revenue declines.
The company reported profits of $7.79 billion for the quarter, a 16% increase compared to last year, also beating analysts' estimates.
"We had a good quarter," Meta CEO Mark Zuckerberg said in a statement accompanying the results. "We continue to see strong engagement across our apps and we have the most exciting roadmap I've seen in a while with Llama 2, Threads, Reels, new AI products in the pipeline, and the launch of Quest 3 this fall."
The company said daily active users for Facebook jumped to 2.06 billion, an increase of 5% year over year. The monthly active user base on Facebook also ticked up 3% year over year.
The results come as demand for digital ads appears to be picking up steam again and as investor enthusiasm surrounding AI has helped buoy the tech sector in recent months.
Zuckerberg laid out his plans for a "year of efficiency" in February following the company's third quarterly revenue decline, after a bruising year in which the company faced steep competition, challenges from Apple's app privacy changes and lower digital ad spending amid broader macroeconomic uncertainty. The year was marked by steep cost-cutting measures and mass layoffs.
Last November, Meta said it would eliminate 11,000 jobs, marking the single largest round of cuts in its history. In March, Zuckerberg announced Meta would lay off another 10,000 employees.
"The year of efficiency was always about two different goals: becoming an even stronger technology company and improving our financial results so we can invest aggressively in our ambitious longterm roadmap," Zuckerberg said Wednesday on a call with analysts. "Now that we've gotten through the major layoffs, the rest of 2023 will be about creating stability for employees, removing barriers that slow us down, introducing new AI-powered tools to speed us up and so on."
The report also comes just weeks after Meta rolled out its competitor to Twitter, Threads. The app gained a stunning 100 million user sign ups in less than a week after its launch, and although user engagement has dipped, Meta has steadily added features to the app in an effort to keep the momentum going.
On the call with analysts, Zuckerberg said, "This is as good of a start as we can hope for" regarding Threads.
"We saw unprecedented growth out of the gate and more importantly, we're seeing more people coming back daily than I'd expected," he added. "And now we're focused on retention and improving the basics. And then after that, we'll focus on growing the community to the scale that we think is going to be possible."
Only after this, he said, will they focus on monetizing Threads. "We've run this playbook many times before with Facebook, Instagram, WhatsApp, stories, reels and more," Zuckerberg said.
Meta shares jumped some 4% in after-hours trading immediately following the earnings results.
- CNN's Clare Duffy contributed to this report.
