- Meta Platforms’ market value exceeds $1 trillion, rejoining the trillion-dollar club.
- Meta achieves profitability through cost-cutting and rebounding advertising revenue.
- Valuation comes as Microsoft becomes second $3 trillion company, after Apple.
Meta Platforms, the social media giant led by Mark Zuckerberg, has once again joined the trillion-dollar market cap club. After a 1.4% surge in the stock market, Meta’s market value exceeded $1 trillion, placing it alongside other tech giants such as Apple, Microsoft, Alphabet, Amazon, and Nvidia.
This week Microsoft also became the second company to pass a $3 trillion valuation.
Also read: Microsoft becomes second company to reach $3 trillion market cap
Rapid growth and rebound
Meta’s market value reached the trillion-dollar milestone in 2021 under its former name, Facebook. However, challenges in late 2021 and 2022 resulted in a brief exit from this exclusive club. Nonetheless, Meta’s stock has seen an impressive 11% increase in the first month of 2024, following a remarkable 194% surge last year. This growth helped the company recover from a 64% drop in stock price during 2022.
From losses to profits
Meta’s journey towards profitability began at the end of 2022 when the company managed to turn losses into gains. Through a combination of cost-cutting measures and a rebound in advertising revenue, Meta’s stock surged to new heights, closing at 384.36 points, surpassing its previous high point at the end of 2021. However, due to previous stock buybacks, Meta’s total market value remained below its peak of $1 trillion in 2021. While the stock briefly surpassed the $1 trillion mark on Monday, it later retraced its gains.
Also read: Apple beats Samsung, claims top spot in global smartphone sales
Positive outlook
Moreover, Meta’s stock has been listed in the IBD 50 top growth stocks and recognized as a leader in quality stock creative services by IBD. These acknowledgments further contribute to the optimistic sentiment surrounding Meta’s future prospects.
Upcoming challenges and expectations
On February 1, Meta will announce its fourth-quarter earnings after the market closes, posing another test for CEO Mark Zuckerberg and his company. Analysts predict a 21% year-on-year increase in Meta’s fourth-quarter revenue, reaching $38.9 billion. Additionally, they forecast a 175% growth in earnings per share compared to the previous year, amounting to $4.84.
Looking ahead, analysts expect Meta’s full-year earnings to grow by 67% to $14.36 per share but anticipate a 37% decline in 2022.
With its market value surpassing $1 trillion once again, Meta solidifies its position as a heavyweight player in the artificial intelligence field. Shareholders remain optimistic about Meta’s future, especially as the company seeks to strengthen its presence in this rapidly evolving industry. The recent investment and focus on artificial intelligence demonstrate Meta’s commitment to innovation and technological advancement.
