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Meta shares drop 20% on Q4 earnings miss, weak outlook

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Re: Meta shares drop 20% on Q4 earnings miss, weak outlook

#431

Post by aylmao »

spookthesunset wrote: post #369
dahdum wrote: post #336

Earlier quoted context omitted.

I disagree, Libra had absolutely massive potential with Facebook, Instagram, and WhatsApp behind it. Stabilized by multiple fiat currencies it would hold value well, and it could power a global Venmo (via WhatsApp), capture a large portion of the entire remittance market, simplify e-commerce payments, and maybe even support micro transactions at scale. I’m sure I’m missing other large benefits. The West is mostly so…

What the hell would be it’s point? Why would it need Satoshi’s Holy Blockchain? Nobody in the mainstream consumer space wants an irreversible cryptocurrency. Why not just use a database? FB picking up Libra is just another loop in the blockchain’s solution in search of a problem.

+1, though I imagine the motivation was probably skipping regulation related to handling international payments or something along that line. Riding the blockchain hype couldn't have hurt too (until it did, I guess).

Re: Meta shares drop 20% on Q4 earnings miss, weak outlook

#432

Post by idontwantthis »

PragmaticPulp wrote: post #299
IgorPartola wrote: post #234

Earlier quoted context omitted.

So in other words TikTok has made them have to pause and switch to prioritize Reels (which are in every way worse than TikTok BTW) and that means less eyeballs on ads. Honestly Facebook at this point is entirely unusable. My feed is full of shit I don’t want (and I block ads at DNS level so I can’t even imagine what it looks like for most people): Reels, half baked “memes” that are just really random thoughts from pe…

> My feed is full of shit I don’t want I don't log in to Facebook very often, but when I do it's not bad at all. I scroll through a few updates from friends and family and catch up with a few people, then I close it for another week or two. There isn't just one "Facebook" that we all see, obviously. Your feed is going to be a reflection of the groups you've joined and the friends you keep (and haven't muted). If you'…

I use FB all the time and it’s great. I subscribe to a few heavily moderated groups for my city that are full of genuinely helpful and productive posts. It’s where I find out what’s going on here.

I’ve unfollowed almost everyone from my past and when I add someone new I unfollow them as soon as they post anything publicly that I don’t care about.

Re: Meta shares drop 20% on Q4 earnings miss, weak outlook

#433

Post by onlyrealcuzzo »

whyenot wrote: post #291
ra7 wrote: post #227

Earlier quoted context omitted.

Didn't they do the same thing when Snapchat took off and then blew it out of the water with Instagram Stories? There is a track record.

I would argue that they destroyed Instagram in the process. It set them on a path where they add more and more "features" to Instagram for legitimate strategic reasons, but in the process it turned a focused app into something now approaching the hot garbage that is the Facebook.

The hot garbage app makes almost as much money as Facebook, so... There's that...

Re: Meta shares drop 20% on Q4 earnings miss, weak outlook

#434

Post by ethbr0 »

skinnymuch wrote: post #201
ethbr0 wrote: post #21

Earlier quoted context omitted.

It's much more difficult to scale price (user pays more) than it is to scale ad revenue (user sees no difference, more / more-per advertiser). At the end of the day, that's why Google and Facebook will fight tooth and nail to avoid subscription offerings. And fundamentally... Facebook's stock should be hammered. They're effectively a legacy platform attempting to milk more revenue from their existing users. They miss…

Google is up 7.5% today. Google had one of the best valuation growths in the past 2 years of mega cap companies. It makes little to no financial sense, compared to other tech and web companies, for Facebook stock to remain down 25%. Their PE is going to be like 17.5 now.

Aren't all current tech valuations still playing chicken with future growth expectations? So when sentiment with regards to them changes, it compounds back on the current price.

But the whatever% is after hours trading, so we'll see what the market does tomorrow when it's open.

Re: Meta shares drop 20% on Q4 earnings miss, weak outlook

#435

Post by onlyrealcuzzo »

skizm wrote: post #385
mathattack wrote: post #174

Earlier quoted context omitted.

It’s not about accuracy. If a stock is priced at a huge multiple to earnings and sales, the market consensus is enormous profit growth for a sustained period. When the slope of the curve moves (or changes direction) the NPV (Net Present Value) of future cash flows drops dramatically. The miss is also against future guidance. This could be answering a question of “Is Facebook too distracted to grow their core business…

> If a stock is priced at a huge multiple to earnings and sales... FBs P/E ratio was well into the value stock territory of ~22 before this dip. They were trading at the lowest multiple of any other big tech company by far, now they're even more insanely undervalued from a fundamentals perspective. I realize that doesn't matter in the age of the meme stock, but personally I'm still pretty bullish in the long term and…

For reference the S&P average P/E is ~25.96.

FB at it's worst is growing much faster than average, it's balance sheet is healthier than almost every other company beside MAAG, and yet it is valued below average.

Re: Meta shares drop 20% on Q4 earnings miss, weak outlook

#436

Post by blihp »

ckardat123 wrote: post #266
Kranar wrote: post #179

Earlier quoted context omitted.

Feel free to do a deep dive on the meaning and nature of earnings estimates, and you'll find it's mostly just a service that exists because it gives the appearance of legitimacy to various financial institutions. Earnings estimates do not come down from God and there's no one single earnings estimate either, different sites and sources will report different estimates. Typically it's just the average or the median of…

Curious if there are any good, public datasets out there on company earnings guidance or earnings estimates. Is earnings guidance typically included within quarterly filings, or is it usually given on earnings calls?

Both. The earnings call is typically just a reading of the filing with a Q&A period at the end where the questions are at best minimally answered.

Re: Meta shares drop 20% on Q4 earnings miss, weak outlook

#437

Post by spywaregorilla »

p1necone wrote: post #211
JCM9 wrote: post #93

Facebook’s core business model appears to be in decline. They don’t have a very diversified revenue stream despite trying various side businesses. This is the market worried that Facebook’s best days are behind it. Facebook is betting the farm on the metaverse stuff but without meaningful financial results that’s not going to placate market concerns over what looks like a downhill future for the core businesses. Face…

I don't get metaverse - they seem to be throwing lots of money and people at it, and hyping it up like it's the future. But from what I've seen so far they've just built VRChat, but worse. It's been done before by other people, it's not a new thing at all (Second Life released almost 20 years ago). This isn't a project that benefits from any of Facebooks strengths - game development companies are much better position…

Have they built anything for the public?

Re: Meta shares drop 20% on Q4 earnings miss, weak outlook

#438

Post by onlyrealcuzzo »

virtuallynathan wrote: post #247
intrepidsoldier wrote: post #71

The data center infrastructure that Facebook (Meta) has is probably in the top 5 in this world (behind only Amazon, Microsoft, Google). They might want to become a cloud infrastructure provider for some side money and buy themselves some time to figure out this Metaverse fantasy :) Hey, AWS started because Amazon wanted to lease out their spare infrastructure capacity.

Based on my calculations, Facebook has more DC space/power than Google/Amazon/Microsoft. They have around 40 million sq ft of DC space, and likely ~5GW of power. They have 48 buildings in 18 locations, with 47 more under construction. AWS Data centers are fairly small, ~180,000 sq ft or so generally, us-east-2 is about 900,000 sq ft. us-east-1 perhaps 8 million sq ft. Google likely has more network capacity, but FB i…

Google does more network requests than the rest of the external web put together. My understanding is FB is far behind Amazon.

Re: Meta shares drop 20% on Q4 earnings miss, weak outlook

#439

Post by aierou »

zepto wrote: post #428
aierou wrote: post #424

Earlier quoted context omitted.

I am interested in the virtual reality space, and started posting because I was frustrated by the spread of misinformation/propaganda. Ironically, there is a lot of misinformation about Facebook. I'm sure my contributions are mostly meaningless, but it has at least been interesting to follow discussions.

Really? What do you think of as misinformation about Facebook?

How about we start with the claim from the recent leaks that they cause depression or body image issues? The leaked document in question [1] should be considered for further research, but it is hardly evidence of this claim.

There is also a popular claim that Facebook contributed to genocide. Here's an article [2]. Facebook hired an investigator that concluded that their involvement was without their knowledge. Tragic and reckless, sure. Intentional? I doubt it. I think it's an issue of scale and navigating complex regulatory and social structures.

Shadow profiles are another hot topic. The big issue is that, if you agreed to let Facebook read your contacts, it linked your friends phone numbers to distinct 'profiles' in the background. Presumably these could also be tied to their advertising profiles.

Cambridge Analytica was a company that abused a bug in API access (allegedly unbeknownst to Facebook - this exploit was available to all 3rd party apps) to collect information not only about willing participants, but their friends as well.

As for VR, there are numerous claims and hesitancy about privacy abuse through tracking and sensing technologies that are essential to VR development. I appreciate some hesitancy, but it is a bit sensationalized.

Beyond all of this, there are lots of claims of monopoly abuse. There is actually an FTC lawsuit that could lead to a landmark antritust case, but that is yet to be seen. I don't really think they have a monopoly as there are numerous competitors.

I apologize as I don't have links for everything, but that's an overview of my thoughts. I think Facebook is simply navigating the regulatory and social landscape in a way that any novel company or platform would be required to navigate. I think we often forget that this technology is new and will experience growing pains, even if at such massive scale. I think a lot of the blame for the fraying of U.S. democracy, the decline in mental health, and other social issues are incorrectly attributed to things that have brought change in the past few decades. More realistically, I think the U.S. (where most of the claims are relevant) is simply declining after several hundred years of abusive reign as the world's superpower.

[1]: https://about.fb.com/wp-content/uploads/2021/09/Instagram-Te...

[2]: https://www.nytimes.com/2018/11/06/technology/myanmar-facebo...

Re: Meta shares drop 20% on Q4 earnings miss, weak outlook

#440

Post by rurp »

onlyrealcuzzo wrote: post #433
whyenot wrote: post #291

Earlier quoted context omitted.

I would argue that they destroyed Instagram in the process. It set them on a path where they add more and more "features" to Instagram for legitimate strategic reasons, but in the process it turned a focused app into something now approaching the hot garbage that is the Facebook.

The hot garbage app makes almost as much money as Facebook, so... There's that...

For now, but this whole thread is about accepting short term costs for long term gains. The overall direction of Instagram doesn't seem to be following that model.
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