Meta's revenue drops for the first time to $28.82 billion in Q2 of FY22

Meta, the social media giant has seen its first-ever revenue decline of 1% as its total revenue has fallen to $28.82 billion in Q2 of FY22, from the $29.07 billion it reported in the corresponding quarter in the previous year.

The total revenue drop combined with total costs and expenses led to a 32% decline in Meta’s Net Income in the quarter ending June 30, 2022.

However, there was a 4% increase in the Daily Active People and Monthly Active people across all platforms that come under Meta, including Facebook, Messenger, Instagram, WhatsApp, Meta Quest, Workplace and Meta Portal.

"It was good to see positive trajectory on our engagement trends this quarter coming from products like Reels and our investments in AI," said Mark Zuckerberg, Founder and CEO, Meta.

Zuckerberg added, "We're putting increased energy and focus around our key company priorities that unlock both near and long-term opportunities for Meta and the people and businesses that use our services."

The Net Revenue for Meta also saw a 32% dip from $10.39 billion in Q2 FY21 to $6.69 billion in Q2 of FY22.

In his forecast, Meta’s CFO David Wehner said that the company expects that the revenue generated from Q3 of FY22 will be in the range of $26-28.5 billion.

“This outlook reflects a continuation of the weak advertising demand environment we experienced throughout the second quarter, which we believe is being driven by broader macroeconomic uncertainty. We also anticipate third quarter Reality Labs revenue to be lower than second quarter revenue. Our guidance assumes foreign currency will be an approximately 6% headwind to year-over-year total revenue growth in the third quarter, based on current exchange rates,” the statement read.

“We expect 2022 total expenses to be in the range of $85-88 billion, lowered from our prior outlook of $87-92 billion,” he added.

As a result of this, Meta has not only reduced their hiring but have also put on hold their overall expense growth plans this year to account for the more challenging operating environment while continuing to direct resources toward the company’s priorities, added Meta’s CFO.

Meanwhile, the company said that Facebook’s Monthly Active Users have grown by 1% on a year-on-year basis to 2.93 billion, the Daily Active Users have seen a year-on-year increase of 3%  to 1.97 billion in Q2 of FY22.

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