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” : ‘int.’; const loginBaseUrl = LOGIN_URL[pageSiteProduct]; const loginUrl = `https://${loginUrlPrefix}${loginBaseUrl}/google-login`; const targetUrl = new URL(window.location.href); targetUrl.searchParams.set(‘isGaa’, true); fetch(registerEndpoint, { method: ‘POST’, body: JSON.stringify({ id_token: credential?.credential, displayContextId: ‘SOCIAL_CONNECT’, returnUrl: window.location.href.split(‘?’)[0], editionId: `${EDITION_ID[pageSiteProduct]}`, registrationSource: `${REGISTRATION_SOURCE[pageSiteProduct]}` }), headers: { ‘content-type’: ‘application/json’, } }) .then((response) => { if (!response.ok) { console.error(‘GoogleEA: Social Connect Invalid Status Code’); return; } return response.json(); }) .then((userState) => { if (!userState) { console.error(‘GoogleEA: Social Connect No Data’); return; } window.location.href = `${loginUrl}?target=${encodeURIComponent(targetUrl)}`; }) .catch((err) => { console.error(`GoogleEA: Social Connect Err: ${err}`); }); } }; })() ]]]]]]]]>]]]]]]>]]]]>]]>
Earnings Outlook
Published: July 24, 2023 at 8:00 a.m. ET
Here’s what to expect when the company’s numbers hit after Wednesday’s closing bell
Meta Platforms Inc. is scheduled to report fiscal second-quarter financial results on Wednesday.
Getty Images
There’s plenty to like as Meta Platforms Inc. steamrolls toward the release of its fiscal second-quarter results on Wednesday.
Analyst sentiment is downright giddy: Meta META, -0.90% shares have skyrocketed over the past six months and are up 144% this year. That has happened as the company’s digital-advertising return on investment and efficiency improve; artificial-intelligence investments increase engagement on Instagram; new social-media platform Threads gains traction; and business picks up on Reels and WhatsApp.
Those factors led JMP analyst Andrew Boone last week to jack up his price target on Meta shares to $350 from $300 while maintaining an outperform rating. “We increase our estimates given strong engagement trends, improving ad performance driven by AI, and as the [second-quarter 2023] advertising environment more broadly appears to be stable,” Boone wrote in a note to clients.
“We are positive on Meta’s fundamentals, as we expect a [second-quarter revenue] beat and [third-quarter revenue] guidance likely calling for growth accelerating,” Jefferies analyst Brent Thill said in a note last week. “Accordingly, we raise our [fiscal year 2023 and 2024 revenue] by 1% and 2%, respectively.”
Of course, nothing is a sure thing — especially in the volatile world of tech. There is a danger that AI spending could deteriorate in an uncertain macroeconomy. And the growth of Threads has dramatically cooled after a white-hot debut.
Here’s what to expect when the numbers hit after Wednesday’s closing bell.
What to expect
Earnings: Analysts tracked by FactSet expect Meta to report $2.91 a share in earnings, up from $2.46 a share a year before. On Estimize, which crowdsources projections from hedge funds, academics and others, the average projection also calls for $2.91 a share in earnings.
Revenue: The FactSet consensus calls for $31.1 billion in revenue, up from $28.8 billion the previous year. Those contributing to Estimize also expect $31.1 billion in revenue.
Stock movement: Meta shares have soared 144% this year, most of that in the last six months. The S&P 500 SPX, +0.40% is up 18% in 2023.
Of the 55 analysts tracked by FactSet who cover Meta shares, 33 have buy ratings and 15 have hold ratings, with an average price target of $309.31.
What to watch for
Investors are keenly interested in whether digital-ad spending has progressed for Meta — and Instagram in particular — as reports from those in the industry suggest.
“We think investors are increasingly optimistic on an improving digital ad
market, while [Meta] has meaningfully rationalized its cost structure and improved
monetization at Reels and Messaging,” Deutsche Bank analyst Benjamin Black said in a note this month.
Jefferies’ Thill, who has a price target of $360, expects Meta to “accelerate revenue growth” based on favorable comparisons with year-over-year comparisons, “higher engagement from AI investments” and and improved advertiser return on investment and efficiency.
In a note last week, Goldman Sachs analyst Eric Sheridan added that Meta shares “present a positive risk/reward” and that the lively stock movement this year reflects a management pivot to what Meta CEO Mark Zuckerberg has called a “year of efficiency.”
Futurum analyst Daniel Newman expects an advertising rebound but is concerned Meta’s big bets in AI and the metaverse face long-term pressure from antagonist Apple Inc. AAPL, +0.42%, which introduced the mixed-reality headset Vision Pro in June.
Barron’s: Microsoft, GM, Verizon, Alphabet, Exxon Mobil, Meta, and More Stocks to Watch This Week
The Federal Reserve is expected to raise interest rates on Wednesday. Plus, earnings reports from Alphabet, Microsoft, Visa, General Electric, Verizon, Meta Platforms, and more.
Jon Swartz is a senior reporter for MarketWatch in San Francisco, covering many of the biggest players in tech, including Netflix, Facebook and Google. Jon has covered technology for more than 20 years, and previously worked for Barron’s and USA Today. Follow him on Twitter @jswartz.
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