Shares of Meta Platforms (NASDAQ: META) have crushed the broader market handsomely in the past year with impressive gains of 154%, driven by robust growth in its top and bottom lines. It looks like its eye-popping rally is here to stay following its latest earnings report.
Meta Platforms released its fourth-quarter and full-year 2023 results on Feb. 1. Shares of the company jumped 20% the following day thanks to its better-than-expected numbers and guidance. The good part is that Meta stock remains affordable, and investors who haven’t bought this tech giant yet should consider buying it hand over fist right now.
Meta Platforms is becoming a bigger player in the digital ad market
Meta Platforms reported Q4 revenue of $40.1 billion, an increase of 25% over the year-ago period. Additionally, the company reduced its costs and expenses by 8% during the quarter, which allowed it to triple its adjusted earnings on a year-over-year basis to $5.33 per share. The numbers were better than consensus expectations of $4.96 per share in earnings on revenue of $39.2 billion.
It is worth noting that Meta’s Q4 revenue grew at the fastest pace since the middle of 2021 and outpaced the company’s full-year revenue increase of 16%. The tech giant’s full-year earnings were up 73% to $14.87 per share on account of its focus on controlling costs and improving the efficiency of its business operations in 2023.
Meta benefited from an improvement in digital ad spending last year. According to eMarketer, digital ad spending increased 10.7% in 2023 to $627 billion. So, Meta grew at a faster pace than the market in which it operates. Moreover, its 2023 revenue indicates that it controlled 21.5% of the digital ad space last year. That’s an improvement over the 20.5% share in 2022.
Even better, Meta’s revenue forecast for the first quarter of 2024 indicates that it could continue to corner a bigger share of the digital ad market. The company is anticipating almost $36 billion in revenue in the current quarter at the midpoint of its guidance range. That would be a 25% increase over the prior-year…
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