Here's the Key Reason Meta Platforms Stock Has Soared 464% Since 2022 -- Hint: It's Not Artificial Intelligence (AI)
In November 2022, Meta Platforms (NASDAQ: META) stock bottomed at around $90 following a 76% plunge from its all-time high. Investors felt the company was neglecting its core social media platforms, Facebook and Instagram, in favor of spending billions of dollars on projects like the metaverse, which generated minimal revenue. That strategy placed significant pressure on Meta's profitability.
CEO Mark Zuckerberg decided to make some drastic changes. By mid 2023, he had cut over 21,000 jobs, committed to spending more cautiously on the metaverse, and invested heavily in artificial intelligence (AI) to enhance Facebook and Instagram, which is already paying off with increased engagement (which leads to more advertising revenue).
Meta's reduced workforce and streamlined cost structure drove a surge in its profitability. In the recent second quarter of 2024 (ended June 30), Meta's net income grew by 73% from the year-ago period, and that followed a more than doubling in net income during each of the previous three quarters:
Source Fool.com
Meta Platforms Inc. Aktie
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