Meta‘s “year of efficiency” paid off in a big way. And it offered a sweetener for investors, sending its stock surging.

Meta had a stellar year, with profits soaring to $14 billion in the last quarter of 2023, more than doubling compared to the previous year. Their sales also saw a significant increase, jumping by 25% to over $40 billion. This outstanding performance led to a surge in their stock value, pleasing investors.

Meta shares surged on Friday following a tripling of profits in the fourth quarter and the company’s inaugural dividend declaration.

Meta, the company that owns Facebook and Instagram, had a strong financial quarter. They reported a profit of over $14 billion, more than double compared to last year. Sales also increased by 25%, surpassing $40 billion. Additionally, Meta announced its first-ever cash dividend of $0.50 per share and a $50 billion share buyback program. While these moves can boost stock prices, some critics argue that they don’t invest enough in improving the business or supporting employees.

Meta First-ever dividend:

Meta, the parent company of Facebook and Instagram, made significant financial announcements. They declared their inaugural cash dividend for shareholders, offering a payout of 50 cents per share on March 26th. Additionally, Meta disclosed a $50 billion share repurchase plan.

These announcements led to a substantial surge in Meta’s stock price, increasing its market capitalization by over $200 billion and surpassing a total valuation of $1.2 trillion. Investors viewed the dividend declaration as a sign of Meta’s maturity and positive direction.

Analysts highlighted Meta’s advancements in artificial intelligence (AI), particularly with their LLaMA large language model. They anticipate that Meta’s AI technology will enhance advertising effectiveness by delivering more relevant ads to users.

Investors were pleased with Meta’s choice to offer a dividend, which is uncommon for high-growth technology firms.

Overall, Meta’s financial initiatives signify growth and adaptation to evolving technological landscapes, garnering optimism from investors and analysts alike.

Meta AI investment plans Details:

Meta, the company behind Facebook, is gearing up to invest heavily in artificial intelligence (AI) this year. They plan to allocate between $30 to $37 billion for this purpose. This increased spending reflects their belief in the pivotal role AI will play in shaping their future projects and products.

Already, Meta has introduced new AI tools for businesses, aimed at enhancing their advertising efforts on the platform. The initial adoption of these tools has been promising, prompting Meta to maintain its focus on AI-powered ads throughout 2024.

Furthermore, Meta has ambitious plans to develop its own advanced AI, known as artificial general intelligence (AGI). This strategic move underscores Meta’s commitment to remaining competitive in the rapidly evolving AI landscape.

In addition to AI, Meta is heavily investing in its Reality Labs unit, which is dedicated to building the metaverse—a virtual world where people can interact using virtual reality technology. Despite incurring significant losses in this area last year, Meta remains steadfast in its determination to advance these ambitious projects.

Meta’Year of efficiency’ pays off:

Meta CEO Mark Zuckerberg aimed to improve efficiency in 2023. Despite heavy investment in the metaverse, which incurred significant costs, Meta’s Reality Labs unit generated over $1 billion in sales in the last quarter.

To address losses and adapt to economic changes, Meta cut over 20,000 jobs. These measures proved successful, with Meta doubling its operating margin to 41% and reducing expenses by 8% compared to the previous year.

Meta Q4 By The Numbers:

Meta, the company behind Facebook, reported that 3.07 billion people use Facebook monthly, showing a 3% increase from the previous year.

Digital ads remain Meta’s primary income source, bringing in $38.7 billion this quarter, up 24% from last year.

Their Reality Labs division, focusing on virtual reality, achieved over $1 billion in sales for the first time but also incurred a $4.6 billion loss due to investments in the metaverse.

On a positive note, Meta’s apps like Facebook, Instagram, and WhatsApp generated $21 billion this quarter, compared to $10.7 billion last year.

Meta also disclosed having 67,317 employees by the end of 2023, which is a 22% decrease from the beginning of the year.