Meta’s revenue shrank for the first time in its history

Facebook parent company Meta has just reported its earnings for the second quarter of 2022, and it was another quarter of shrinking profits. Total revenue of $28.8 billion was only down one percent compared to Q2 one year ago, but net income dropped 36 percent to $6.7 billion. Making almost $7 billion in profit is not a bad quarter for anyone, but the size of the decline compared to a year ago is pretty significant. And, according to the Wall Street Journal, this is the first-ever drop in revenue for Meta / Facebook — so even though we’re only talking one percent, it’s still noteworthy.

Revenue from advertising and Meta’s “family of apps” was essentially flat year-over-year, and Reality Labs (home to hardware like the Meta Quest and other metaverse-related initiatives) actually grew 48 percent year-over-year to $452 million. But Reality Labs accounted for a $2.8 billion loss this quarter, a 15 percent larger loss than Q2 one year ago. At this rate, it seems likely that Reality Labs will lose Meta more than the $10 billion it cost the company in 2021. Indeed, the company said it expects Reality Labs revenue to be lower in the third …read more