Meta and Spotify shares falling 20% after quarterly results
Shares in both Meta (Facebook-owner) and Spotify fell around 20% in post-market trading when the companies presented their quarterly reports.
Meta’s daily active users fell for the first time and the company warned of slowing revenue growth facing competition from other social media and a tough advertising market.
Spotify’s said its outlook was “subject to substantial uncertainty” because of the pandemic. CEO Daniel Ek told investors it is too early to know how the discussions about Joe Rogan’s controversial podcast and artists protests against it, will affect the company.
Meta said revenue for the current quarter will be USD 27 – 29 billion. Net income in the last quarter of 2021 was USD 10.3 billion, down 8% year over year, partly explained by investments in the metaverse that is CEO Mark Zuckerberg’s vision and emphasized by the company’s name change to Meta.
Spotify reported revenue of USD 3 billion, up 24% year on year. Markets have worried about possible effects of artists protesting against covid statements in a podcast by Joe Rogan. Commenting on it CEO Daniel Ek said it is too early to know:
“Usually when we’ve had controversies in the past, those are measured in months, not days.”
Rogan is reported to have an average of 11 million listeners. His podcast has included controversial statements on the importance of mass vaccination against covid.
Spotify has over the last few years invested heavily in being a podcast platform making podcasting an important part of the company’s business.
Meta reported daily active users of 1.929 billion in the fourth quarter, down from 1.930 billion in the third.
Commenting on the decline, Zuckerberg said sales growth had been hurt by competition about younger users.
Meta said it’s advertising business had been negatively affected by Apple’s changes in its operating system. Apple has said the changes improves privacy as users have to actively activate the option of receiving targeted advertising.
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