The debate over whether Meta is in decline may get quietened, at least for now.
After three straight quarters of falling revenue, Meta, the company formerly known as Facebook, on Wednesday reported that revenue for the first quarter jumped 3 percent, to $28.6 billion, from a year ago. Profits fell 24 percent, to $5.7 billion, partly because of restructuring charges.
The results, which surpassed Wall Street expectations and Meta’s own guidance, were bolstered by a growth in users. The company added 37 million daily users to Facebook, its marquee app, up 4 percent from a year earlier and a turnaround from its first-ever drop in users that it reported in early 2022.
“We had a good quarter and our community continues to grow,” Mark Zuckerberg, the chief executive of Meta, said in a statement. He added that the company was “becoming more efficient so we can build better products faster and put ourselves in a stronger position to deliver our long-term vision.”
The performance comes amid a year of tumult for the social media company, which is trying to revamp itself after experiencing declining revenue and what Mr. Zuckerberg has called an overstuffed work force.
He has been moving the company into the so-called immersive world of the metaverse, an untested market. Meta also faces stiff competition from adversaries like TikTok, which is stealing advertising dollars away from social media companies, and Apple, which has put the screws to Facebook’s advertising technology with privacy updates to the iOS software.
Those challenges, which follow years of unbridled growth at Meta, have raised questions about the company’s future and its vulnerabilities.
In a turnaround attempt, Mr. Zuckerberg has embarked on what he calls a “year of efficiency” and has reined in spending and slashed employee ranks by more than 21,000 people, or roughly 30 percent. Meta’s stock price, which rose roughly 9 percent in after-hours trading, has surged 63 percent since the company announced a first round of layoffs in November.
Those moves have also led to a drop in employee morale. Workers are questioning whether they will be among those cut in Meta’s cullings of the work force. Mr. Zuckerberg has said he is trying to eliminate “managers managing managers,” the result of a glut of middle management driven by overzealous pandemic-era hiring. He has announced two rounds of layoffs so far, and more cuts are expected to come next month.
The company said its employees totaled 77,114 as of March 31, down 1 percent from a year ago.
Even with the latest results, Meta’s challenges remain. The company’s costs continued to rise, jumping 10 percent, to $21.4 billion, from a year ago and outstripping revenue growth.
As hype for the metaverse has died and shifted to artificial intelligence, Meta is also trying to position itself as a leader in the field, drawing on years of investment. Mr. Zuckerberg is attending weekly meetings with his executive team, specifically focused on the company’s A.I. strategy. He has told investors that the company’s A.I. is helping to suggest more relevant photos and videos to people across Instagram and Facebook.
“Our A.I. work is driving good results across our apps and business,” Mr. Zuckerberg said.
