Meta 1Q25 Earnings, Zuckerberg’s Five AI Opportunities, Meta is CoComelon for Adults
Hello everyone. We will use today’s update to circle back to Meta’s latest earnings report. The company reported earnings a few weeks ago. While Meta is the most direct competitor to Apple among Big Tech companies, there are some signs of the companies’ product paths, which have been getting closer to each other, potentially staying apart.
Meta 1Q25 Earnings
The big picture was very much intact with Meta’s 1Q25 earnings. Digital ads strength is more than offsetting atrocious losses in Reality Labs.
With 1Q25 revenue up 16% and costs up 9%, Meta’s operating margin grew to 41% from 38%. As previously disclosed, the company benefited from an “extension of server useful lives.” Said another way, depreciation wasn’t as bad as it otherwise would have been. Ad impressions were up 5% (primarily Asia-Pacific) while average price per ad was up 10%.
One additional point regarding expenses: Meta’s general and administrative expense fell by a whopping 34% year-over-year – a $1.2B drop – due to lower legal costs. That helped to offset more than half of the year-over-year increase in R&D (+22%).
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