scorecardFacebook parent Meta soars 19% after Mark Zuckerberg promises 'year of efficiency' cost cuts and a $40 billion share buyback
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Facebook parent Meta soars 19% after Mark Zuckerberg promises 'year of efficiency' cost cuts and a $40 billion share buyback

George Glover   

Facebook parent Meta soars 19% after Mark Zuckerberg promises 'year of efficiency' cost cuts and a $40 billion share buyback
Stock Market1 min read
Meta CEO Mark Zuckerberg.    Stephen Lam/Reuters
  • Facebook parent Meta's stock jumped almost 19% in premarket trading Thursday after its Q4 earnings report.
  • The tech giant missed on some earnings targets and said it would buy back $40 billion in shares.

Facebook parent Meta's stock soared Thursday after CEO Mark Zuckerberg pledged to carry on cutting costs and to return around $40 billion in cash to investors via share buybacks.

Shares climbed almost 19% in premarket trading to around $181.71 at last check, after ending the previous regular session at $153.12.

The social media giant released its fourth-quarter earnings report after Wednesday's closing bell. It said its quarterly revenue fell 4% year-on-year to $32.17 billion, beating analysts' forecasts for $31.55 billion. Earnings were $1.76 a share, missing expectations for $2.26 a share, but the comparison is clouded by restructuring charges.

Looking ahead, the company projected first-quarter revenue of $26-28.5 billion, topping analyst estimates. The upbeat outlook comes as investors fret about the impact of a possible recession on companies' earnings.

Meta cut its expenses targets for 2023 by an additional $5 billion and said it would repurchase another $40 billion worth of shares from investors. Buybacks tend to be bullish for a stock because they reduce the total supply of shares on the market and show a company's faith in its own business model.

Zuckerberg said 2023 would be a "year of efficiency" as the tech giant tries to cut costs to save up some cash ahead of a potential economic downturn.

"Our management theme for 2023 is the 'year of efficiency', and we're focused on becoming a stronger and more nimble organization," he said.

Meta let go of more than 11,000 employees in November in a round of what Zuckerberg called "last resort" layoffs.

It's trying to cut costs to boost its profitability. A combination of rising interest rates, poor earnings performances and Wall Street's unwillingness to support a pivot to the metaverse weighed on the company, and Meta shares fell 61% in 2022.

Read more: Mark Zuckerberg declares 2023 'the year of efficiency.' More Meta layoffs are likely.




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