META: Meta Stock Wipes Out $200B in 15% Crash as Increased Spending Spooks Investors

Earnings were fine and dandy. But then Zuck kicked off his earnings call with how much money Meta can lose by betting on risky investments. Yep — metaverse, too.

• Meta stock META fell sharply in after-hours trading Wednesday after the company posted otherwise solid earnings. But then chief executive Mark Zuckerberg got on a call with investors and spoiled the mood. Zuck spooked investors by saying that he wants to turn Meta into “the leading AI company in the world,” and raised full-year expenses guidance to $96-$99 billion from $94 billion. Shares fell 15% ahead of Thursday’s opening, washing out $200 billion in market capitalization.
• ”We’ve seen a lot of volatility in our stock,” Meta boss said, “where we’re investing in scaling a new product but aren’t yet monetizing it.” He spent time talking about the metaverse — the immersive but amorphous online realm — and pledged to continue investing in it for the long-term. In the first quarter, metaverse-related losses amounted to $3.85 billion with only $440 million in sales. Total metaverse losses from inception in late 2020 have piled to $45 billion.
• The good stuff — Meta’s earnings release showed revenue jumped 27% to $36.5 billion, topping consensus calls for $36.2 billion. Earnings per share arrived at $4.71, vs. expectations of $4.32 a share. “It’s been a good start to the year,” Zuck said in a statement. “We’re seeing healthy growth across our apps and we continue making steady progress building the metaverse as well.” Shares of Meta are up more than 40% this year, but today’s open will change that.