Meta (META) shares plunged more than 22% on Thursday morning after the Facebook parent reported the prior day that its revenue declined last quarter and missed analysts’ expectations.
The bad news comes as the social media giant pushes harder into the metaverse, the 3-D virtual world that inspired the company’s leadership to change its name. Not everyone’s sold on the change, and the numbers coming out of Meta and the broader macroeconomic environment certainly don’t help.
“There is also a messaging problem here. They’re making progress versus Apple and TikTok and they’re getting hit on macro as well as metaverse,” MKM Partners Managing Director Rohit Kulkarni told Yahoo Finance Live on Thursday.
Facebook’s earnings report and sinking stock mark just the latest bad news for Big Tech. The sector — even tech’s biggest names, including Alphabet and Microsoft — have been rattled by a hawkish Fed and an inflation squeeze that’s made its way to consumers.
But, in many ways, Meta still stands apart. The company changed its name only a year ago, signaling its pivot towards the metaverse and away from the social media business that built it.
Reality Labs, the division that oversees its metaverse efforts, has continued to lose money, with Meta’s recent earnings report revealing a loss of $3.7 billion last quarter compared to $2.6 billion in the same quarter a year ago.
Allie Garfinkle is a Senior Tech Reporter at Yahoo Finance. Follow her on Twitter at @agarfinks.
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