Meta (NASDAQ: META) Q1 2024 Results: Cleo Capital’s Managing Director Explains Why She’s Bullish on Zuckerberg’s AI Bet

On 24 April 2024, Meta Platforms Inc (NASDAQ: META) Reported its First Quarter 2024 Results.

According to Meta’s press release, Mark Zuckerberg, Meta laminitis and CEO, had this to say:

“It’s been a bully commencement to the year. The caller mentation of Meta AI with Llama 3 is different measurement towards gathering the world’s starring AI. We’re seeing steadfast maturation crossed our apps and we proceed making dependable advancement gathering the metaverse arsenic well.“

As for the Meta CFO, Susan Li, she said:

“We expect 2nd 4th 2024 full gross to beryllium successful the scope of $36.5-39 billion. Our guidance assumes overseas currency is simply a 1% headwind to year-over-year full gross growth, based connected existent speech rates.

“We expect full-year 2024 full expenses to beryllium successful the scope of $96-99 billion, updated from our anterior outlook of $94-99 cardinal owed to higher infrastructure and ineligible costs. For Reality Labs, we proceed to expect operating losses to summation meaningfully year-over-year owed to our ongoing merchandise improvement efforts and our investments to further standard our ecosystem.“

The adjacent day, Sarah Kunst, Managing Director astatine Cleo Capital, appeared connected CNBC’s “Worldwide Exchange” to sermon Meta’s net report

Here’s a elaborate breakdown of her comments:

1. Stock Performance and Capex Guidance:
   • Kunst noted the important driblet successful Meta’s banal terms owed to the institution raising its superior expenditure (capex) guidance portion besides providing brushed gross guidance. She suggested that this capitalist absorption is partially fueled by anterior experiences with CEO Mark Zuckerberg’s ambitious projects, which haven’t ever panned out, referencing his foray into the metaverse arsenic an example.
2. AI Investments:
   • Despite the costliness of AI, Kunst argued that investing successful this exertion makes consciousness for Meta. She emphasized that AI is simply a important and existent opportunity, fixed Meta’s technological capabilities and wealthiness of data. Kunst expressed assurance that Meta’s stake connected AI would beryllium profitable for those investors who stay unshaken by short-term uncertainties.
3. Metaverse Skepticism:
   • Kunst was captious of Zuckerberg’s continued concern successful the metaverse, peculiarly highlighted by the important losses ($3.85 billion) reported by Meta’s Reality Labs segment. She compared this unfavorably with competitors similar Apple, who are besides venturing into augmented world technologies. Kunst implied that the marketplace had not embraced the metaverse technology, careless of the promoter.
4. Digital Ads Business:
   • Meta’s superior gross source, integer advertising, missed estimates by 6%, which Kunst attributed to a broader planetary displacement successful advertizing dynamics alternatively than a circumstantial contented astatine Meta. She discussed however the existent geopolitical and home unrest affects brand-safe advertising, suggesting that these factors are causing companies to reconsider wherever their ads are placed.
5. Comparison with Other Tech Giants:
   • She highlighted that portion integer ads are a important gross watercourse for different tech companies similar Alphabet, Microsoft, and Amazon, Amazon mightiness beryllium amended positioned successful the existent market. This is owed to Amazon’s absorption connected merchandise listing ads, which are considered much brand-safe compared to the societal content-based ads prevalent connected platforms similar Meta.

At the clip of penning (5:46 p.m. UTC connected April 25), META is trading astatine $437.88, down 11.27% connected the day.

Source: Google Finance

Featured Image via YouTube (Meta’s Channel)