Facebook owner Meta sees shares up 25% after cost cuts and buyback
Meta shares were a whopping 25% amid plans to cut costs and give a $40 billion share buyback. In terms of guidance, Meta forecast Q1 revenue between $26bn and $28.5bn, in line with analysts’ average estimates of $27.1bn.
(Video Transcript)
Meta shares surge
Meta Platforms, which owns Facebook, was in absolute lift-off mode last night. It jumped 25% on the IG platform last night in extended trade as a result of news that came out after the bell.
Investors gave little interest to earnings and revenue, where fourth quarter (Q4) net income fell to a $1.76 per share, much lower than the $2.26 expected. A drop was largely due to a $4.2 billion charge related to layoffs and office closures. Revenue reached a whopping $32.17 billion.
Share price chart
Now, let's take a look at what's been happening with shares because there was absolute lift-off last night.
As I said, a straight up candle this is a Marubozu candle. You can see where it started at yesterday's session at the low point. And it ended without any sellers in this market at all, up a total of 25.12%. This is after chief executive Mark Zuckerberg described 2023 as the year of efficiency and updated the market on a series of cost cutting measures like its plans for lower data centre construction expenses this year and pledged stricter cost control.
And we remember the group parted with more than 11,000 jobs back in November, which did cost that money and a one-off. In total Meta Platforms to cut costs in 2023 by $5 billion to a range of between $89 billion to $95 billion.
The group also announced a new $40 billion share buyback program in terms of guidance, better forecast first quarter revenue between $26bn and $28.5bn in line with analysts, average estimates of $27.14 billion. But it was good news for investors last night in Facebook owner Meta.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Act on share opportunities today
Go long or short on thousands of international stocks with spread bets and CFDs.
- Get full exposure for a comparatively small deposit
- Trade on spreads from just 0.1%
- Get greater order book visibility with direct market access
See opportunity on a stock?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Take your position
- See whether your hunch pays off
See opportunity on a stock?
Don’t miss your chance – upgrade to a live account to take advantage.
- Trade a huge range of popular stocks
- Analyse and deal seamlessly on fast, intuitive charts
- See and react to breaking news in-platform
See opportunity on a stock?
Don’t miss your chance. Log in to take advantage while conditions prevail.
Live prices on most popular markets
- Equities
- Indices
- Forex
- Commodities
Prices above are subject to our website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
