By Katie Paul and Yuvraj Malik
(Reuters) -Meta Platforms forecast third-quarter revenue above market expectations on Wednesday, sending shares up on the suggestion that it anticipated higher ad spending as a result of an improving macroeconomic environment.
The company expects July-September revenue in the range of $32 billion to $34.5 billion, compared with analysts’ average estimate of $31.30 billion, according to Refinitiv data.
“We continue to see strong engagement across our apps and we have the most exciting roadmap I’ve seen in a while with Llama 2, Threads, Reels, new AI products in the pipeline, and the launch of Quest 3 this fall,” said Mark Zuckerberg, Meta’s chief executive.
The revenue bump comes despite the company also forecasting that expenses would rise in both 2023 and 2024, citing costs including legal fees and increased spending on infrastructure considered key to the tech sector’s feverish AI race.
Shares initially surged 7% in after-hours trading before dropping back to around 2% above closing price.
Meta also beat second-quarter revenue estimates. Revenue grew 11% to $32 billion in the quarter ended June, compared to analysts’ average estimate of $31.12 billion.
(Reporting by Katie Paul in New York and Yuvraj Malik in Bengaluru; Editing by Arun Koyyur and Matthew Lewis)
