Mark Zuckerberg asks for "patience" but Wall Street turns its back on him.
Faced with a quarterly report with halved profits and declining revenues, Meta stocks sink, losing 25% and burning 80 billion dollars worth in a single session.
A thud that is added to the collapse of 61% since the beginning of the year, with which the giant has seen over 660 billion of market capitalization go up in smoke as it slips out of the twenty largest American companies.
Meta's net profit in the third quarter fell 52% to 4.4 billion, below analysts' expectations.
Revenues fell 4% to € 27.71 billion, the slowest rate since it landed on the stock market in 2012. For the current quarter, the company estimates revenues of € 30-32 billion.
while for 2022 total expenses should amount to between 85 and 87 billion, and then rise to 96-101 billion next year.
Figures that frighten investors, especially given the slowdown in growth.
Meta, Zuckerberg admits, is facing "short-term revenue challenges" but the "fundamentals are there for a return to stronger growth. I appreciate patience and believe that those who are patient and invest in us will ultimately be rewarded. ".
The CEO therefore does not give up on the metaverse, on the contrary doubles his bet: "we are doing a job that will be of historical importance".
His words, however, are not enough to reassure in the face of increasingly fierce competition, especially from TikTok.
Meta's disappointing results come in the midst of a wave of tech sales, the results of which continue to disappoint expectations.
After having been a protagonist during the pandemic, Big Tech is feeling the effects of inflation and interest rate hikes and signaling a difficult period on the horizon with the quarterly reports.
Silicon Valley is in fact navigating the same problems as the rest of the economy: driven by consumer spending during the emergency Covid has invested heavily to keep up with demand, and now that spending is slowing down it is having difficulty adjusting to the new reality.
However, the slowdown of Big Tech signals weaknesses not only linked to the economic situation.
Despite the billions invested, the giants so far have not found a new profitable idea,
some observers highlight: Meta and Google continue to rely on advertising sales, just as the iPhone continues to be Apple's growth engine.
Zuckerberg's bet on the metaverse has not yet borne fruit and it will take, as initially admitted by the CEO, some time before we see the results.
How long it takes is unclear and it is precisely this that is making investors nervous.
The preliminary indications suggest a long road.
According to rumors reported by the Wall Street Journal Horizon, Meta's metaverse platform is not taking off as expected.
The company had initially set a target of 500,000 active users for Horizon Worlds by the end of the year, but recently the target was reduced to 280,000.
At the moment, the newspaper continues,
users are around 200,000 per month and many of the visitors do not generally return to the app after the first month.
A worrying cross-section for investors who, it is not clear, how much patience they will have to see tangible results.
Amazon closed the third quarter with revenues down 15% to 127.1 billion dollars, below analysts' expectations.
And for the last three months of the year it expects revenues of 140.0-148.0 billion, under the forecasts of the market which was betting on 155.2 billion.
Net income fell to 2.9 billion, or 28 cents per share, better than the 22 cents expected by analysts.
Disappointing sales estimates for the current quarter sink Amazon's stocks to Wall Street, where after-hours trading is losing up to 21%.