"Strongest Earnings Report in History"? Media: Meta Platforms is just learning to reserve funds for the Metaverse.

Meta Platforms Platforms' fourth-quarter performance exceeded expectations across the board, while also unveiling two killer moves: "historic first dividend + large-scale buyback plan." Last Friday, the stock price soared by 20%, pushing the market value back above $1 trillion, making it the "strongest earnings report in Meta Platforms Platforms' history."

However, media analysis on Monday pointed out that Meta Platforms Platforms Platforms has only learned how to "allocate funds more reasonably" for the metaverse.**

At the end of 2021, when Mark Zuckerberg first expressed his interest in the "metaverse," Meta Platforms Platforms Platforms was unceremoniously kicked out of the "trillion-dollar club." As the company took a series of more aggressive measures, including renaming itself Meta Platforms Platforms and increasing its annual capital expenditure budget by nearly 80%, investors' concerns grew, and Meta Platforms Platforms' market value lost more than a quarter in a single day.

Zuckerberg realized this and launched the so-called "Year of Efficiency" plan, which involved a significant 22% reduction in workforce in 2023. Subsequently, the performance improved, but Zuckerberg has no intention of giving up on the metaverse. On the contrary, he plans to continue increasing related expenses.

During the company's fourth-quarter earnings conference call, Zuckerberg stated:

We have made great progress in advancing the vision of artificial intelligence and the metaverse. In addition, he also pointed out that artificial intelligence and the metaverse will remain the focus of Meta Platforms Platforms' future investments.

In addition to the historic first dividend and large-scale buyback, Meta Platforms Platforms has raised its upper limit for capital expenditure expectations by $2 billion this year, reaching $37 billion.

The increase in capital expenditure is mainly used for the construction of company data centers and the demand for artificial intelligence on servers and other infrastructure. Previously, Zuckerberg announced that Meta Platforms Platforms plans to purchase approximately 350,000 NVIDIA H100 GPUs by the end of the year. Combined with other GPUs, the total computing power owned by Meta Platforms Platforms will approach that of nearly 600,000 H100 GPUs. But this time Wall Street is not worried about the huge expenses. Mark Mahaney, an analyst at Evercore ISI, pointed out that Meta Platforms' cost structure has been reduced, advertising revenue growth has improved, and shareholder-friendly measures such as dividends have been taken. Roth MKM analyst Rohit Kulkarni also stated that dividends will bring more new shareholders, further driving up the stock price.

Bernstein analyst Mark Shmulik put it more simply, last quarter gave investors a simple conclusion - trust Zuckerberg.

Media analysis points out that as long as the right numbers continue to move in the right direction, this trust is likely to be maintained. In 2022, annual advertising revenue declined for the first time, but it grew by 16% in 2023 and rebounded over time. In 2023, the operating profit margin of the company's core application division jumped 10 percentage points to 47%, reflecting improved financial performance of products such as Reels.

Even the Reality Labs division, which carries the company's metaverse vision, saw unexpected growth in revenue in the fourth quarter, surpassing the $1 billion mark for the first time, mainly due to strong sales of the company's Quest VR headset. However, this business is still costly, with an operating loss of over $16 billion in 2023.