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Revenue jumped 25% in the fourth quarter for Meta, from $32.2 billion a year earlier. That’s the fastest rate of growth for any period since mid-2021, and comes amid a rebound in the online ad market. Meta’s net income more than tripled, to $14 billion from $4.65 billion a year earlier.
Meta said it would pay investors a dividend of 50 cents a share on March 26, in the company’s first-ever cash dividend. That comes after cash and equivalents swelled to $65.4 billion at the end of 2023, from $40.7 billion a year earlier.
Meta also announced a $50 billion share buyback.
Investors praised the dividend announcement.
Ben Barringer, technology analyst at Quilter Cheviot, said this represented a “symbolic moment and indicates what a turnaround story Meta has been on since its struggles in 2022.”
“Mark Zuckerberg is showing that he wants to bring shareholders along with him and is highlighting that Meta is now a mature, grown-up business,” Barringer said in emailed comments.
Investors have also been focusing on Meta’s moves in the artificial intelligence space. The company has a stake in the ground in AI with its LLaMA large language model, a competitor to Microsoft-backed OpenAI’s GPT-4.
Barringer called Meta a “closet AI winner” and said the company’s AI, while not out in show, “will be better servicing advertisers and making the ads themselves more relevant for users.”
Cash dividends are a rare step for technology companies, which tend to be valued by investors on their ability to achieve high growth rates that requires cash investments back into the business.
Meta CEO Mark Zuckerberg made a big push for 2023 to be a “year of efficiency” for the company.
Several investors had questioned its ventures in 2022 into areas like virtual reality and the metaverse, which was an incredibly costly initiative for the company.
Meta has been deep in cost-cutting mode over the last year or so, in response to the changing tide of sentiment around formerly much-loved technology stocks.
Those cost-cutting steps appear to have paid off. Meta reported a doubling of its operating margin, to 41%.
Meanwhile, the company’s expenses decreased 8% year over year to $23.73 billion. That’s as Meta slashed headcount dramatically, laying off 20,000 people during 2023.
Sales in Meta’s Reality Labs unit passed $1 billion in the fourth quarter, Meta said, though the virtual reality unit recorded $4.65 billion in losses.
– CNBC’s Jonathan Vanian contributed to this report
