Meta Posts 23% Growth as Ads Rebound, With Profit More Than Doubling

Mark Zuckerberg, Meta’s chief executive, spent the past two years weathering a slump in digital advertising and cutting costs. This year, he proclaimed, would be a “year of efficiency” for his company.

Some fruits of those labors are now beginning to show.

Meta, which owns Facebook, Instagram, WhatsApp and Messenger, reported on Wednesday that revenue rose 23 percent to $34.15 billion in the third quarter, above Wall Street estimates of $33.6 billion, according to data compiled by FactSet. Profit was $11.6 billion, more than double the $4.4 billion from a year earlier.

Meta’s growth was bolstered by a rebound in digital ads, which has also fueled the financial performance of other companies. On Tuesday, Google reported increased ad sales, with Snap also disclosing rising sales after revenue declined for two quarters.

But Meta’s results were also helped by its cost cuts, as expenses fell 7 percent from a year earlier to $20.4 billion.

The results underscored Meta’s resilience amid a tumultuous few years for Silicon Valley. The company saw record profit and user growth in the early days of the pandemic, as people were forced indoors and connected through their devices and apps. But the easing of the pandemic, combined with higher interest rates and global economic uncertainty, later hit Meta. The company reduced its work force by roughly a third and flattened its organizational structure.

“The company may be starting to come out of the woods as the Mark Zuckerberg-led company continues to focus on improving operating efficiency,” said Jesse Cohen, senior analyst at Investing.com.

Meta’s user growth continued in some of its key markets, including the United States and Canada. About 3.14 billion people use one or more of the company’s apps every day, up 7 percent from last year. Nearly half the people on the planet — almost four billion — use one or more of Meta’s apps each month.

Threads, Meta’s Twitter competitor, is doing well with just under 100 million users, the company said. Mr. Zuckerberg said he expected to continue adding features to the app to keep people coming back to it.

Meta added that it expected revenue in the current quarter to be $36.5 billion to $40 billion. It also forecast that expenses would be lower next year than previously anticipated, at $87 billion to $89 billion, down from previous guidance of $88 billion to $91 billion. Meta added that it expected its losses from its Reality Labs division, which is working on products related to the metaverse, to continue increasing next year.

The company is being careful with other spending, however, as it monitors what Susan Li, Meta’s chief financial officer, called a “volatile environment” with war in the Middle East. Ms. Li said the company had seen some “softening” in advertising spending in certain areas at the beginning of the conflict, and compared it to when Russia invaded Ukraine last year.

Mr. Zuckerberg has continued to invest in the metaverse, an interconnected world that he believes will become the next generation of digital connection. That has meant spending heavily on hardware devices like virtual reality goggles and augmented reality glasses and making multibillion-dollar investments in gaming companies that produce content for those devices.

The costs of those investments has far outpaced their income, with no guarantee that people will flock to the metaverse. Yet Mr. Zuckerberg has made it clear that he is behind the metaverse effort for the long haul.

More recently, Meta has leaned heavily into artificial intelligence as Silicon Valley and tech giants including Google and Microsoft have been gripped by a frenzy over the technology. In September, Meta introduced a slew of A.I.-powered chatbots, designed to provide fun or informative distractions.

In an earnings call on Wednesday, Mr. Zuckerberg said he expected to start hiring more A.I.-focused technologists. He also cautioned that chatbots were in their early stages and would improve over time as the company worked out the early kinks and errors.

“It’s going to take time to tune all of these experiences before hundreds of millions or billions of people are going to use them,” he said.