Meta Platforms, parent company of Facebook, Instagram and WhatsApp, beat Wall Street's targets for the second quarter and upped its outlook for the current period. Meta stock jumped Thursday on the news.
The Menlo Park, Calif.-based social media giant late Wednesday said it earned $2.98 a share on sales of $32 billion in the June quarter. Analysts polled by FactSet had expected Meta earnings of $2.91 a share on sales of $31.08 billion. On a year-over-year basis, Meta earnings increased 21% while sales advanced 11%.
Meta's second-quarter results broke a losing streak of six consecutive quarters with year-over-year declines in earnings. Meanwhile, Meta's revenue rose for the second quarter in a row after three straight quarters of declines.
For the third quarter, Meta predicted revenue of $32 billion to $34.5 billion. The midpoint of $33.25 billion is well above Wall Street's prediction of $31.22 billion.
"We had a good quarter," Chief Executive Mark Zuckerberg said in a news release. "We continue to see strong engagement across our apps and we have the most exciting roadmap I've seen in a while with Llama 2, Threads, Reels, new AI products in the pipeline, and the launch of Quest 3 this fall."
Meta Stock Surges After Report
On the stock market today, Meta stock surged 4.4% to close at 311.71. During the regular session Wednesday, Meta stock rose 1.4% to close at 298.57.
Year to date through Thursday's close, Meta stock is up 159%.
Meta's daily active users rose 7% year over year to 3.07 billion in June. Its monthly active users increased 6% to 3.88 billion.
Advertising impressions across Meta's apps rose 34% year over year in the second quarter. But the average price per ad decreased by 16% year over year.
Analysts Raise Their Price Targets
At least 28 analysts raised their price targets on Meta stock after the company's upbeat earnings report.
Baird analyst Colin Sebastian reiterated his outperform rating on Meta stock and raised his price target to 355 from 330.
"Q2 results and outlook did not disappoint, as Meta benefits from a combination of stabilizing advertising trends, improving engagement and monetization, and higher margins," Sebastian said in a note to clients.
He added, "Meta exceeded expectations on practically every line item, taking back share, and still showing growth in daily and monthly active users."
Meta stock is on IBD's Leaderboard and Tech Leaders stock lists.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
