Meta’s ad revenue jump 24% in Q4, exceeding expectations

Meta’s ad revenue increased by 23.8% in the final quarter of 2023 compared to the year-earlier period, surpassing expectations.

Advertising revenue for Q4 2023 was $38.7 billion compared to $31.3 billion in the same period in 2022. This success helped drive total Meta revenue to grow 25% year-on-year from $32.2 billion in Q4 2022 to $40.1 billion in Q4 2023.

Daily active users. Meta’s Q4 2023 performance also showed impressive growth in user engagement.

• Family daily active people was 3.19 billion on average for December 2023, an increase of 8% year-over-year.
• Family monthly active people was 3.98 billion as of December 31, 2023, an increase of 6% year-over-year.
• Facebook daily active users were 2.11 billion on average for December 2023, an increase of 6% year-over-year.
• Facebook monthly active users were 3.07 billion as of December 31, 2023, an increase of 3% year-over-year.

Year of AI. Looking ahead, Meta plans to spend between $30-37 billion on capital expenditures, $2 billion more than initially forecasted, with a focus on investments in AI. The revised range reflects the company’s evolving understanding of AI capacity needs for future foundational research and product development.

Why we care. After a challenging year for ad revenue on rival platform X, Meta is gaining popularity among advertisers. The sustained growth suggests success on the platform, making Meta’s ad products worthy of consideration. However, the rising popularity might lead to increased ad prices. Advertisers should weigh the platform’s effectiveness against potential cost changes.

What Meta is saying. Mark Zuckerberg, Meta founder and CEO, said in a statement:

• “We had a good quarter as our community and business continue to grow.”
• “We’ve made a lot of progress on our vision for advancing AI and the metaverse.” 

Earnings report. You can review Meta’s full report here.