Facebook and Instagram Parent Meta sees volatility in the ad market due to the conflict in the Middle East

Facebook and Instagram parent Meta beat Wall Street expectations for the three months ended September, but said the current fourth quarter was experiencing ad volatility consistent with the war between Israel and Hamas.

Snap, which also announced good third quarter figures yesterday, warned against this. Both companies noted that it was difficult to provide financial guidance to Wall Street given the situation.

“In the fourth quarter, we saw continued strong ad demand in key segments … but we also see greater volatility early in the quarter,” Chief Financial Officer Suan Li said in a conference call with CEO Mark Zuckerberg. following the release of Meta’s latest financial results. The company expanded its guidance for the fourth quarter to reflect “the greater uncertainty and volatility in the landscape ahead.”

“Although we do not have significant direct revenue from Israel and the Middle East, we experienced lower advertising spend at the start of the fourth quarter related to the outbreak of the conflict,” she said.

“Our thoughts are with all those affected by the terrible violence in the Middle East. We know that our services can be an essential tool for information, connection and expression at a time like this. We continue to monitor the situation and do everything we can to keep people and our services safe.”

The parent company of Facebook and Instagram beat Wall Street estimates, posting a 23% rise in revenue to $34.15 billion in the September quarter thanks to a recovery in digital advertising. Profit more than doubled to $11.6 billion, more than double the $4.4 billion from a year ago, due in part to cost-cutting, including massive layoffs. The workforce of 66,185 employees decreased by 24% compared to the previous year.

User growth continued and according to Meta, 3.14 billion people use one or more of the company’s “family of apps” daily, a 7% increase from last year. Facebook’s daily active users (DAUs) averaged 2.09 billion in September 2023, up 5% year-on-year.

The figures came a day after Meta was sued by 41 states over Instagram and Facebook’s use of strategies and algorithms to attract the attention of children and teenagers, which they say are harmful to the mental health of minors who suffer from “depression, anxiety , insomnia and disorders “suffer, make education unsafe”. and everyday life and many other negative consequences.” No one on the call asked about the lawsuit, which alleges that Meta rejected important safeguards such as “alternative age verification.”