Insights

Why Meta Platforms Stock Was Falling Today

What happened
Shares of Meta Platforms (NASDAQ: FB), the Facebook parent, were falling today on a number of concerns, including fears about the company’s earnings report after hours today, a post-earnings sell-off in rival Alphabet, and an errant report from Bloomberg that showed the company missing revenue estimates in the first-quarter earnings report.
Facebook stock was down 2.8% heading into the close.

Image source: Meta Platforms.

So what
The decline in Meta stock today seemed to be mostly over fears that the company could miss estimates again in its report after hours, which comes at a time when market sentiment has turned sharply against the tech sector.
The Facebook owner missed expectations badly in its last report and guided for revenue growth of just 3% to 11% for the first quarter, down sharply from its historical norm. The company is struggling with competition from TikTok as well as Apple’s ad tracking transparency initiative, which has hurt its advertising business, and it has been pouring money into Reality Labs, its division devoted to building technology for the metaverse, with little to show for it so far.
A report from Bloomberg briefly triggered a sell-off this afternoon after it erroneously reported that Facebook missed estimates, though the media company quickly said the report was mistaken.
Finally, a sell-off in Alphabet stock also seemed to push Meta shares lower today. While the Google parent’s report was mostly in line with estimates, earnings per share fell because it took a mark-to-market loss on investments, growth in YouTube slowed down, and it lost nearly $1 billion in Google Cloud despite strong growth. 
Now what
Analysts see Meta’s first-quarter revenue increasing 19% to $28.2 billion, but expect earnings per share to fall from to $3.30 to $2.56, a reflection of the increased spending on reality labs.
It’s a good bet that Meta will swing significantly in one direction or another after hours as the stock is at a pivotal juncture. If the metaverse doesn’t take off as CEO Mark Zuckerberg believes, the company will be saddled with tens of billions of dollars of losses with nothing to show for it.
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Jeremy Bowman has positions in Meta Platforms, Inc. The Motley Fool has positions in and recommends Alphabet (A shares), Alphabet (C shares), Apple, and Meta Platforms, Inc. The Motley Fool recommends the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool has a disclosure policy. –

What happened

Shares of Meta Platforms (NASDAQ: FB), the Facebook parent, were falling today on a number of concerns, including fears about the company’s earnings report after hours today, a post-earnings sell-off in rival Alphabet, and an errant report from Bloomberg that showed the company missing revenue estimates in the first-quarter earnings report.

Facebook stock was down 2.8% heading into the close.

Image source: Meta Platforms.

So what

The decline in Meta stock today seemed to be mostly over fears that the company could miss estimates again in its report after hours, which comes at a time when market sentiment has turned sharply against the tech sector.

The Facebook owner missed expectations badly in its last report and guided for revenue growth of just 3% to 11% for the first quarter, down sharply from its historical norm. The company is struggling with competition from TikTok as well as Apple‘s ad tracking transparency initiative, which has hurt its advertising business, and it has been pouring money into Reality Labs, its division devoted to building technology for the metaverse, with little to show for it so far.

A report from Bloomberg briefly triggered a sell-off this afternoon after it erroneously reported that Facebook missed estimates, though the media company quickly said the report was mistaken.

Finally, a sell-off in Alphabet stock also seemed to push Meta shares lower today. While the Google parent’s report was mostly in line with estimates, earnings per share fell because it took a mark-to-market loss on investments, growth in YouTube slowed down, and it lost nearly $1 billion in Google Cloud despite strong growth. 

Now what

Analysts see Meta’s first-quarter revenue increasing 19% to $28.2 billion, but expect earnings per share to fall from to $3.30 to $2.56, a reflection of the increased spending on reality labs.

It’s a good bet that Meta will swing significantly in one direction or another after hours as the stock is at a pivotal juncture. If the metaverse doesn’t take off as CEO Mark Zuckerberg believes, the company will be saddled with tens of billions of dollars of losses with nothing to show for it.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Jeremy Bowman has positions in Meta Platforms, Inc. The Motley Fool has positions in and recommends Alphabet (A shares), Alphabet (C shares), Apple, and Meta Platforms, Inc. The Motley Fool recommends the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool has a disclosure policy.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

  • This field is for validation purposes and should be left unchanged.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US & HK* Trades. Click Here!