Meta Q2 results: ‘it’s a very attractive stock’

Shares of Meta Platforms Inc (NASDAQ: META) are down 4.0% in extended trading after the tech behemoth reported its first-ever year-over-year drop in quarterly revenue.

Meta Q2 results snapshot

• Earned $6.69 billion versus the year-ago figure of $10.39 billion
• EPS of $2.46 was significantly below $3.61 in Q2 of 2021
• Sales went down nearly 1.0% year-over-year to $28.82 billion
• Consensus was $2.54 of per-share earnings on $28.9 billion in sales
• DAUs grew 4.0% to 2.88 billion; well ahead of 1.96 billion expected
• Reality Labs (metaverse focused business) lost $2.80 billion

Meta Q2 results were weak due to supply constraints, increased competition from the likes of TikTok, Apple’s privacy changes, the Ukraine war, inflation, and the slowdown in advertising, as per the management.

Future outlook and expert’s remarks

More alarmingly, Meta forecasts things to get worse in its current financial quarter. For Q3, it expects revenue to fall between $26 billion and $28.5 billion; the top end of the range represents a 1.7% annualised decline.

In comparison, analysts had called for $30.36 billion. Reacting to Meta Q2 results on CNBC’s “Closing Bell: Overtime”, Baker Avenues’ King Lip said:

Meta names a new CFO

Also on Wednesday, Meta said Susan Li (VP of Finance) will replace David Wehner as the CFO as he transitions into a new position of Chief Strategy Officer.

Heading into Meta Q2 results, Wall Street had a consensus “overweight” rating on the stock that’s down over 50% year-to-date.