Meta records its first quarterly revenue drop in company history

By our News Team | 2022

Increased competition from new platforms and reduced spending by advertisers worried about a recession has hit Facebook and Instagram.

Meta, the company that owns social media platforms such as Facebook and Instagram, has announced the first drop in revenue in its history. The announcement was made by Mark Zuckerberg, its Chief Executive, during a financial results update for the second quarter of 2022.

The company has been experiencing difficult economic times for the past three financial quarters. Compared with the same period in 2021, Meta experienced a 1% drop in overall revenue to just under US$29-billion.

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Advertising, which is the main source of revenue, has been falling as advertisers become increasingly cautious about the global economy and concerns about an international recession.

The effectiveness of ads being placed on Facebook and other social media platforms is also increasingly being questioned, given that Apple now allows users of its products to opt out of tracking. Online privacy restrictions are also being stepped up by various national governments and regulatory authorities, making ad effectiveness harder to quantify.

Increased competition from new industry players

There is also increased competition from industry newcomers such as short-form video platform TikTok and photo-sharing app BeReal.

“We seem to have entered an economic downturn that will have a broad impact on the digital advertising business,” Zuckerberg said in a call with analysts. “It’s always hard to predict how deep or how long these cycles will be, but I’d say that the situation seems worse than it did a quarter ago.”

According to Zuckerberg, Meta is still focused on helping people connect with friends and family. Social media users, he noted, are discovering interesting content in their feeds and then messaging that content to friends. 

“This creates this flywheel of discovery and then social connection … inspiring people to create more content themselves,” Zuckerberg said. The company has seen a more than 30% increase in the time people spend engaging with its short-form video feature, called Reels, across both Facebook and Instagram.

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    Dr Kin Kariisa

    Group CEO - Next Media

    Dr. Kin Kariisa is an extraordinary force at the helm of Next Media Services, a conglomerate encompassing NBS TV, Nile Post, Sanyuka TV, Next Radio, Salam TV, Next Communication, Next Productions, and an array of other influential enterprises. His dynamic role as Chief Executive Officer exemplifies his unwavering commitment to shaping media, business, and community landscapes.
    With an esteemed academic journey, Dr. Kariisa’s accolades include an Honorary PhD in exemplary community service from the United Graduate College inTexas, an MBA from United States International University in Nairobi, Kenya, a Master’s degree in Computer Engineering from Huazong University in China, and a Bachelor’s degree in Statistics from Makerere University.
    Dr. Kariisa pursued PhD research in Computer Security and Identity Management at Security of Systems Group, Radboud University in Nijmegen, Netherlands. As a dynamic educator, he has shared his expertise as a lecturer of e-Government and Information Security at both Makerere University and Radboud University.

    Dr Kin did his PhD research in Computer Security and Identity Management at Security of Systems Group, Radbond University in Nigmegen, Netherlands. He previously served as a lecturer of e-Government and Information Security at Makerere University in Kampala, Uganda and Radbond University in Netherlands.

    Dr Kin did his postgraduate courses in Strategic Business Management, Strategic Leadership Communication and Strategies for Leading Successful Change Initiatives at Harvard University, Boston USA.

    • Other current and previous roles played by Dr Kin Kariisa:
    • Lecturer of e-Government and Information Security to graduate students at Makerere University, Kampala and Radbond University in the Netherlands
    • Director of Eco Bank Uganda Limited, one of the largest banks in Africa
    • Chairman of the National Association of Broadcasters, an umbrella industry association for all Television, Radio and online broadcasters in Uganda.
    • Chairman of Board of Directors of Nile Hotel International, that owns the leading hotel in Uganda, Kampala Serena Hotel.
    • Chairman of Board of Directors of Soliton Telmec Uganda, the leading telecom company in Optic fibre business managing over 80% of optic fibre in Uganda.