Meta shares drop as Q2 profit declines due to legal expenses and severance costs

Meta Platforms said Wednesday that second-quarter profit fell even as revenue beat Wall Street expectations. legal expenses And severance pay costs for recent layoffs focused on the results.

The parent company of Facebook and Instagram earned $15.85 billion, or $6.18 per share, in the April-June period. This was down 14% from $18.34 billion, or $7.14 per share, in the same period a year ago.

Revenue increased 28% from $47.52 billion to $60.8 billion.

Analysts on average expected earnings of $7.19 per share and revenue of $60.22 billion, according to a survey by FactSet.

“Artificial intelligence today is accelerating our core business, powering our next generation of products, and opening the door to entirely new enterprise opportunities,” he said. CEO Mark Zuckerberg in a statement. “Results are already visible and I am optimistic about the potential ahead.”

Meta said that the number of daily active users in the “application family” (Facebook, Messenger, Instagram and WhatsApp) increased by 3% compared to the previous year, reaching $3.6 billion.

The Menlo Park, Calif.-based company had 75,472 employees as of June 30; This figure decreased by 1% compared to the previous year. That figure still includes about 8,000 workers the company said it would lay off. Meta said its third-quarter earnings report will have the updated figure.

For the current quarter, Meta is forecasting revenue in the range of $61 billion to $64 billion; The midpoint of that figure is below the $63.14 billion analysts expected.

Total expenses were $42.03 billion, an increase of 55% compared to last year. That includes $2.40 billion in legal action-related expenses and $1.18 billion in severance expenses in connection with layoffs announced in May, Meta said.

Meta’s shares fell $24.76, or 4.2%, to $560.85 in after-hours trading after the results were announced.