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Note almost the entirety of the lost revenue is from Europe, quarter on quarter year on year. Considering Meta's business is advertising. The fact advertising

by urthor 4y ago

Note almost the entirety of the lost revenue is from Europe, quarter on quarter year on year. Considering Meta's business is advertising. The fact advertising revenue is flat in the Americas & Asia is a strong signal companies are not cutting advertising. Ergo, no massive collapse in consumer confidence is predicted. It's just Europe that looks dire. Or at least that's what Meta wants you to think.

onlyrealcuzzo 4y ago
Revenue is flat in the US - yet dollars are down ~8% - so adjusted for inflation - revenue is down considerably.
- acchow 4y ago
  Don't they report earnings in constant dollars?
  - jsemrau 4y ago
    Not sure what "constant dollars" are, but I did Board Reporting for a Fortune 25 company and we used a 3 month average to limit the impact of sudden fluctuations.
  - onlyrealcuzzo 4y ago
    No.
- NovemberWhiskey 4y ago
  That's not how anyone reports on this; you don't deflate your revenues for changes in the value of money.
spaceman_2020 4y ago
I wonder how much of this is the "spite spending" effect. We've barely had 6 months of normalcy. People are sitting on some savings. Many haven't left the house or traveled freely for 2 years. Maybe that's why they're okay spending more than they usually would - just a "f*ck it" after 2 years of isolation. Certainly was the case for me. I certainly overpaid for a lot of things recently. But we had our big festival here this week and now I'm tapped out. Next year will be a year of sobriety - at least for me.
- CleverLikeAnOx 4y ago
  I think for every spite spender there is at least one other person who is habitually cautious now. I have found it harder to get some people to go out and do things.
  - spaceman_2020 4y ago
    Happening more and more with me. Food prices are legitimately too high. I could justify it earlier in my head because I'd been saving for two years. But now...I'm tapped out.
DeRock 4y ago
The real story is how much expenses rose. As a percentage of revenue, expenses went from 70% last quarter, to 80% this quarter. Even if their revenue was flat (it wasn't), that alone would represent a third of their net income disappearing.
darth_avocado 4y ago
What most people don't realize is that revenue in Europe is down not because spending is down, but because dollar is stronger. They don't explain this here, but they did in Tesla earnings. Expect multinational companies to have a lower European business this quarter.
- deleted 4y ago
  [deleted]
- NovemberWhiskey 4y ago
  >They don't explain this here, but they did in Tesla earnings It's in the first bullet point on page 2: Revenue was $27.71 billion, a decrease of 4% year-over-year, and an increase of 2% year-over-year on a constant currency basis. Had foreign exchange rates remained constant with the third quarter of 2021, revenue would have been $1.79 billion higher. EDIT: who thinks there would still be explanatory wording added here if forex rates had moved the other way and revenues had gone up ... ?
- deleted 4y ago
  [deleted]
ssl232 4y ago
Apart from $/€ being down, could this also have something to do with the GDPR starting to get enforced, biting into Facebook's ability to make targeted advertisements? In the past 6 months or so I've noticed cookie permission popups mostly no longer have all their tracking options enabled by default.
colinmhayes 4y ago
number of ads shown up 17%, price per ad down 18%. Seems to me that advertising is being cut and meta is making up for it by showing more ads per user per time.
blinding-streak 4y ago
It was a bad quarter, but the real kicker is the cautious guidance Meta issued for the current quarter. They signaled to wall street that their problems are only getting worse.

by urthor 4y ago

onlyrealcuzzo 4y ago

Revenue is flat in the US - yet dollars are down ~8% - so adjusted for inflation - revenue is down considerably.

acchow 4y ago
Don't they report earnings in constant dollars?
- jsemrau 4y ago
  Not sure what "constant dollars" are, but I did Board Reporting for a Fortune 25 company and we used a 3 month average to limit the impact of sudden fluctuations.
- onlyrealcuzzo 4y ago
  No.
NovemberWhiskey 4y ago
That's not how anyone reports on this; you don't deflate your revenues for changes in the value of money.

spaceman_2020 4y ago

I wonder how much of this is the "spite spending" effect. We've barely had 6 months of normalcy. People are sitting on some savings. Many haven't left the house or traveled freely for 2 years. Maybe that's why they're okay spending more than they usually would - just a "f*ck it" after 2 years of isolation. Certainly was the case for me. I certainly overpaid for a lot of things recently. But we had our big festival here this week and now I'm tapped out. Next year will be a year of sobriety - at least for me.

CleverLikeAnOx 4y ago
I think for every spite spender there is at least one other person who is habitually cautious now. I have found it harder to get some people to go out and do things.
- spaceman_2020 4y ago
  Happening more and more with me. Food prices are legitimately too high. I could justify it earlier in my head because I'd been saving for two years. But now...I'm tapped out.

DeRock 4y ago

The real story is how much expenses rose. As a percentage of revenue, expenses went from 70% last quarter, to 80% this quarter. Even if their revenue was flat (it wasn't), that alone would represent a third of their net income disappearing.

darth_avocado 4y ago

What most people don't realize is that revenue in Europe is down not because spending is down, but because dollar is stronger. They don't explain this here, but they did in Tesla earnings. Expect multinational companies to have a lower European business this quarter.

deleted 4y ago
[deleted]
NovemberWhiskey 4y ago
>They don't explain this here, but they did in Tesla earnings It's in the first bullet point on page 2: Revenue was $27.71 billion, a decrease of 4% year-over-year, and an increase of 2% year-over-year on a constant currency basis. Had foreign exchange rates remained constant with the third quarter of 2021, revenue would have been $1.79 billion higher. EDIT: who thinks there would still be explanatory wording added here if forex rates had moved the other way and revenues had gone up ... ?
deleted 4y ago
[deleted]

ssl232 4y ago

Apart from $/€ being down, could this also have something to do with the GDPR starting to get enforced, biting into Facebook's ability to make targeted advertisements? In the past 6 months or so I've noticed cookie permission popups mostly no longer have all their tracking options enabled by default.

colinmhayes 4y ago

number of ads shown up 17%, price per ad down 18%. Seems to me that advertising is being cut and meta is making up for it by showing more ads per user per time.

blinding-streak 4y ago

It was a bad quarter, but the real kicker is the cautious guidance Meta issued for the current quarter. They signaled to wall street that their problems are only getting worse.