Meta Stock Near 7-Year Low With Earnings Due

Facebook owner Meta Platforms (META) is set to report fourth-quarter earnings late Wednesday, as the company struggles through the most difficult period since its founding 19 years ago. Meta stock trades near a seven-year low.

X

Analysts expect adjusted earnings of $2.26 a share, according to analysts polled by FactSet. That’s down 38% from the year-ago quarter. The consensus on revenue calls for $31.55 billion. That’s down 6% and its third consecutive quarterly decline.

Meta stock edged up 1.1%, near 150.60, during afternoon trading on the stock market today.

The earnings report comes amid a highly difficult year for Meta, which announced plans in November to cut 11,000 jobs. The job cuts involve 13% of Meta’s workforce.

Like other social media companies, including Snap (SNAP), Etsy (ETSY) and Pinterest (PINS), Meta is challenged not only by macroeconomic weakness but also by a painful drop in digital advertising, which accounts for almost all of its revenue.

Further evidence of these challenges became evident in the fourth-quarter earnings report of Snap, owner of Snapchat, which was hammered after disappointing results. Snap stock plunged about 13% in afternoon trading.

Privacy Changes Tackle Meta Stock

Meta lost roughly $10 billion in ad revenue last year after Apple (AAPL) changed privacy policies for the iPhone. That change made it more difficult to accurately target users with ads.

But the company made technology improvements with its ad strategy approach. In a note to clients, Credit Suisse analyst Stephen Ju, said he expects to see “gradual improvements to Meta’s revenue dollar growth” as a result.

Meta also plans to pour billions toward its development of the so-called metaverse.

Meta stock has a Relative Strength Rating of 72 out of 100.

Please follow Brian Deagon on Twitter at @IBD_BDeagon for more on tech stocks, analysis and financial markets.

YOU MAY ALSO LIKE:

Facebook-Parent Meta, Hit By Hard Times In 2022, May Be Overcoming Obstacles

In An Emotional Letter, Zuckerberg Details Reason For Mass Meta Layoffs

Best Growth Stocks To Buy And Watch: See Updates To IBD Stock Lists

Find The Best Long-Term Investments With IBD Long-Term Leaders

Inside The IBD 50: Top Stocks To Watch