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Facebook Cuts Costs as Meta Platforms Stock Tanks

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Facebook parent Meta Platforms posted earnings that fell short of forecasts on Wednesday, plunging the company’s stock in after-hours trading as the social media giant with metaverse ambitions scrambles to slash expenses amid advertising headwinds caused by global economic concerns.

The claim comes less than a month after billionaire CEO Mark Zuckerberg outlined massive cost-cutting plans that included restructuring teams and implementing a hiring freeze.

According to Forbes, Meta reported a net income of $4.4 billion, or $1.64 per share, down 49% year on year and falling short of analyst forecasts of $1.89 per share; revenue of $27.7 billion was somewhat higher than the $27.4 billion forecasted, but down 4% year on year.

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The corporation also stated that its revenue for the current quarter would be between $30 billion and $32.5 billion, which is at the lower end of average analyst projections.

Meta shares fell 11% to $115 soon after the report, bringing losses to more than 61% this year, significantly worse than the Nasdaq’s 30% drop.

Bank of America analyst Justin Post downgraded Meta shares to a neutral rating in a pre-earnings note, stating that the company’s investment in the immersive virtual reality world known as the metaverse “will remain [an] overhang” on the stock, costing an estimated $10.7 billion next year even as economic concerns potentially intensify.

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Facebook Cuts Costs as Parent Meta Stock Tumbles in 4th Quarter

Meta Platforms Restructuring

The report comes less than a month after Meta Platforms revealed plans to cut costs by restructuring some departments and putting a hiring freeze as ad revenue growth slows amid growing economic pressures:

On Monday, an investor with more than $300 million in stock asked the corporation to cut costs further by laying off workers.

In the earnings release, Meta Platforms CFO David Wehner stated that the company has “increased scrutiny on all areas of operating expenses,” but it also stated that its employee headcount would remain roughly flat from current levels next year; in the third quarter, the company’s free cash flow, which measures cash left over after operating expenses, fell to $173 million from $9.5 billion a year ago.

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$47.2 billion in total. That was the value of Meta founder Mark Zuckerberg, 38, after the market closed on Wednesday.

Zuckerberg’s fortune, once valued at more than $130 billion, has dropped by more than 60% since Meta stock peaked in September 2021.

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Meta Platforms Investor Urges CEO Mark Zuckerberg to Cut Costs

Mr. Zuckerberg, according to Altimeter Capital Chief Executive Brad Gerstner, must take urgent actions to streamline Meta’s operations and address a precipitous drop in the share price.

“Like many other organizations in a zero-rate environment,” Mr. Gerstner wrote in the letter, “Meta has gone into the realm of excess—too many people, too many ideas, too little urgency.” “Meta needs to rediscover its mojo.”

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Meta Platforms shares have fallen more than 50% in the last 18 months, slashing the company’s market worth by more than $600 billion. On Wednesday, Meta will disclose profits after the bell.

Meta did not respond to the letter. Altimeter did not reply immediately to a request for comment.

According to FactSet, Altimeter, which manages over $18 billion, owned around 2.5 million Meta shares at the end of the second quarter. This position, at around $320 million, is not among Meta’s top 15 institutional shareholders.

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Mr. Gerstner stated that his firm, which is based in Boston and has operations in Meta’s hometown of Menlo Park, Calif., has been a longtime shareholder in the company but now believes it needs to “become fit and focused.”

Mr. Gerstner stated that Meta should slash headcount expenses by 20%, reflecting the opinions of others who have recently suggested that digital businesses have become bloated with too many staff after years of expansion.

“It’s a well-kept secret in Silicon Valley that firms like Google, Meta, Twitter, and Uber could produce comparable levels of revenue with significantly fewer workers,” he claimed.

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Meta reported 83,553 employees at the end of the second quarter, a 32% increase from the previous year.

Like many other IT companies, Meta has been slashing costs for months, dealing with slowed growth and growing competition.

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Mr. Gerstner also advised the business to reduce its investment in the metaverse, which Mr. Zuckerberg has hailed as the company’s future and estimated would require more than $10 billion in annual spending.

Mr. Gerstner advised the corporation to cap its spending at $5 billion per year, describing Meta’s commitment as “super-sized and alarming, even by Silicon Valley norms.”

Despite enormous investment thus far, the company is falling short of its metaverse aspirations to create an immersive online experience where users may work, buy, and play.

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According to The Wall Street Journal, their primary metaverse service for consumers, Horizon Worlds, has less than 200,000 monthly active users.

“People are perplexed as to what the metaverse even is,” Mr. Gerstner wrote.

Mr. Gerstner emphasized that he was not making demands and believed in Meta’s future.

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Source: WSJ, Forbes, VOR News

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Elon Musk Chastises Apple for 30% App Store Fees

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Elon Musk Chastises Apple for 30% App Store Fees

Elon Musk slammed Apple in a series of tweets o Twitter on Monday over its 30% App Store fees, providing Spotify and Epic Games with a powerful ally in their battle against the tech giant.

Elon Musk chastised Apple for charging software developers a fee for in-app purchases and posted a meme implying he was willing to “go to war” rather than pay the levy.

Musk also claimed that Apple had threatened to remove Twitter from its app store, though he did not elaborate.

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Spotify has filed antitrust complaints against Apple in Europe, and Epic Games planned to sue Apple in the United States in 2020.

Musk, who purchased Twitter last month, has announced plans to charge users $8 per month to become verified on the social media platform to increase profitability and avoid bankruptcy. A 30% reduction would be a significant blow to those plans.

After Spotify filed an antitrust case against Apple in 2019, the European Commission has been investigating whether Apple’s rules for app developers violate its rules.

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If found guilty of violating EU antitrust rules, Apple faces a fine of up to 10% of its global revenue.

Apple is “playing a dangerous game,” according to Luke Suddards, an analyst at investment insights firm Finimize, by threatening to remove Twitter from its App Store.

“If Twitter is suspended, another lawsuit could be filed. Elon Musk used the courts effectively during his Twitter acquisition, and it would not be surprising if he used the same strategy now.”

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Apple vs. Epic Games

Epic Games asked a three-judge U.S. federal appeals panel earlier this month to overturn portions of a lower court antitrust ruling that favored Apple and its App Store payment business.

Apple previously stated that the commissions it receives help it fund app reviews to ensure consumers are not exposed to fraudulent, pornographic, or privacy-invading apps.

“Apple continues to disadvantage competitors, with significant consequences for consumers, app developers, and, most recently, authors and publishers. Nothing will change unless policymakers take action. “Last month, Spotify CEO Daniel Ek posted on Twitter.

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Musk, who was in the process of purchasing Twitter at the time, responded to Ek’s post with “concerning.”

However, some analysts are concerned that going to war with Apple will drive more users away from Twitter.

“While Musk seeks to rekindle the ongoing feud between Apple and developers, all of this negativity will drive Twitter users away,” said Paolo Pescatore, an analyst with PP Foresight.

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“People are not going to abandon their iPhones… They are used to signing up for various social services but only use one phone at a time, “He stated.

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Apple threat to yank Twitter from App Store

In a series of tweets on Monday, Elon Musk accused Apple of threatening to block Twitter Inc from its app store without explaining why. He also claimed that the iPhone maker had stopped advertising on social media.

The billionaire CEO of Twitter and Tesla claimed that Apple was putting pressure on Twitter over content moderation requirements.

Apple has not confirmed the action, but it would not be unusual given that the company has routinely enforced its rules and previously removed apps such as Gab and Parler.

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Apple restored Parler, popular among US conservatives, in 2021 after the app updated its content and moderation practices, the companies said at the time.

“Apple has largely discontinued advertising on Twitter. Do Americans despise free speech? “Musk, who purchased Twitter for $44 billion last month, stated in a tweet.

In a subsequent tweet, he tagged Apple CEO Tim Cook’s Twitter account, asking, “what’s going on here?”

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Apple did not respond immediately to requests for comment.

“It wasn’t clear to me how far up the Apple food chain that idea went internally,” Randal Picker, a law professor at the University of Chicago, said.

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Apple was the top advertiser on Twitter.

According to ad measurement firm Pathmatics, the world’s most valuable company spent an estimated $131,600 on Twitter ads between Nov. 10 and Nov. 16, down from $220,800 between Oct. 16 and Oct. 22, the week before Musk closed the Twitter deal.

According to an internal Twitter document, Apple was the top advertiser on Twitter in the first quarter of 2022, spending $48 million and accounting for more than 4% of total revenue for the period.

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Twitter did not immediately respond to a request for comment on the report from Reuters.

The up to 30% fee Apple charges software developers for in-app purchases was among Musk’s list of grievances, with Musk posting a meme suggesting he was willing to “go to war” with Apple rather than pay the commission.

The fee has drawn criticism and lawsuits from companies such as Epic Games, the creators of ‘Fortnite,’ as well as the attention of regulators worldwide.

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The commission may consider Musk’s efforts to increase subscription revenue at Twitter, partly to compensate for the exodus of advertisers due to content moderation concerns.

Since the acquisition, companies ranging from General Mills Inc (GIS.N) to luxury automaker Audi of America have stopped or paused advertising on Twitter, and Musk stated earlier this month that the company had seen a “massive” drop in revenue.

Ad sales generate roughly 90% of Twitter’s revenue.

The self-described free speech absolutist, whose company has reinstated several Twitter accounts, including that of former US President Donald Trump, in recent days, has blamed activist groups for putting pressure on advertisers.

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According to Ben Bajarin, the head of consumer technologies at research firm Creative Strategies, Musk may be reading too much into a routine process Apple uses for app review.

“App review from Apple is not perfect by any means, and it is a consistently frustrating process for developers,” he said. “However, from what I hear, it is a two-way conversation.”

Elon Musk to Grants Amnesty to Suspended Accounts

Twitter to Grant “Amnesty” to Suspended Accounts

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Twitter to Grant “Amnesty” to Suspended Accounts

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Twitter to Grant "Amnesty" to Suspended Accounts

Twitter CEO Elon Musk announced Thursday that he is granting “amnesty” to suspended accounts, which alleged experts predict will increase harassment, hate speech, and misinformation.

The billionaire announced after asking for votes on the reinstatement of accounts that have not “broken the law or engaged in egregious spam” in a poll posted to his timeline. The yes vote received 72% of the vote.

“The populace has spoken. The amnesty period begins next week. “Vox Populi, Vox Dei,” Musk wrote on Twitter, referring to the Latin phrase that means “the voice of the people, the voice of God.”

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Musk used the same Latin phrase after posting a similar poll last weekend before reinstating former President Donald Trump’s account, which Twitter had banned for encouraging the Capitol insurgency on January 6, 2021. Trump has stated that he will no longer use Twitter but has not deleted his account.

Such online polls are far from scientific and are easily manipulated by bots.

Racist, anti-Semitic, and other toxic speech has been on the rise on the world’s de facto public square in the month since Musk took over Twitter, according to groups that monitor the platform. This has included increased racist abuse directed at World Cup soccer players, which Twitter allegedly fails to address.

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The increase in harmful content is largely due to the chaos after Musk decided to lay off half of the company’s 7,500-person workforce, fire top executives, and then issue a series of ultimatums that prompted hundreds more to resign.

A slew of contractors in charge of content moderation was also let go. Yoel Roth, Twitter’s head of trust and safety, was among those who resigned due to a lack of trust in Musk’s willingness to keep Twitter from devolving into chaos of uncontrolled speech.

Some advertisers have also withdrawn from Twitter.

Musk tweeted on Oct. 28, the day after assuming control, that no suspended accounts would be reinstated until Twitter formed a “content moderation council” with diverse viewpoints to consider the cases.

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On Tuesday, he said he was breaking that promise because he agreed to it at the request of “a large coalition of political-social activist groups,” who later “broke the deal” by urging advertisers to at least temporarily stop doing business with Twitter.

A day earlier, Twitter reinstated far-right Rep. Marjorie Taylor Greene’s account, which was suspended in January for violating the platform’s COVID misinformation policies.

Meanwhile, Musk has become increasingly friendly with right-wing figures on Twitter. He urged “independent-minded” Americans to vote Republican ahead of this month’s midterm elections in the United States.

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According to a European Union report released Thursday, Twitter took longer to review hateful content this year and removed less of it than in 2021.

The report was based on data collected in the spring — prior to Musk’s acquisition of Twitter — as part of an annual assessment of online platforms’ adherence to the EU’s code of conduct on disinformation. It discovered that Twitter assessed just over half of the illegal hate speech notifications it received within 24 hours, down from 82% in 2021.

Source: AP, VOR News

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Stop Toxic Twitter Attacks Advertisers Over Trump

Stop Toxic Twitter Attacks Advertisers Over Trump

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Stop Toxic Twitter Attacks Advertisers Over Trump

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Stop Toxic Twitter Attacks Advertisers Over Trump Reinstated

On Monday, a coalition of woke activists urged Twitter’s advertisers to issue statements about pulling their ads after Elon Musk lifted the Twitter ban on former US President Donald Trump.

Trump’s account was reinstated over the weekend after Twitter’s woke CEO suspended it following the riot at the United States Capitol on January 6, 2021. He allegedly cited that the ban was for the risk of further incitement of violence.

Twitter generates 90% of its revenue from the sale of digital advertisements.

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The Stop Toxic Twitter coalition, founded by disgruntled Twitter employees and woke activists, complained that Musk had promised advertisers that Twitter would take a cautious approach to reinstate banned accounts and convene a new content moderation council.

As of Monday, no such council had been formed.

“This was a real breach, according to Angelo Carusone, president of Media Matters, a coalition member with a far left-leaning woke media watchdog, said on Monday.

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Musk, he claimed, “lied from the start.”

“In less than three weeks, Musk had broken a promise he made to advertisers,” said Jessica Gonzalez, co-chief executive of Free Press, a woke democracy group also part of the Twitter coalition.

Twitter did not immediately respond to Reuters‘ request for comment.

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Musk sted earlier this month that pressure from woke activists had already resulted in a “massive drop in revenue.”

Late last week, Twitter began reinstating banned or suspended accounts, including comedian Kathy Griffin and Trump.

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On Monday, Twitter reactivated U.S. House Representative Marjorie Taylor Greene’s account.

According to Carusone, the Anti-Musk coalition is demanding brands that have not publicized their Twitter pause to make public statements to pressure the other 49 advertisers who have not taken action.

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“You must take a stand and draw a line,” Carusone advised. “It’s critical for big spenders to state that they’ve stopped.”

He added that if the companies have not issued a public statement about pausing ads, the coalition will consider naming them later this week.

Musk announced on Saturday that Twitter would restoreTrumps account after a Twitter poll on the subject.

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The names at the top of Twitter’s top advertisers had shifted since the week before Musk completed his company acquisition.

Carusone

Media Matters Founders Hypocrisy

Angelo Carusone, the president of Media Matters, faced scrutiny over a series of derogatory comments on his blog that resurfaced.

According to The Daily Caller, Angelo Carusone appeared to make derogatory comments about Jews, “transvestites” and Japanese people.

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Carusone has a track record of inflammatory statements. Carusone’s now-defunct blog included degrading references to “trannies,” “Jewry,” and Bangladeshis. Carusone posted a lengthy diatribe in November 2005 about a Bangladeshi man robbed by “a gang of transvestites,” as Carusone described it.

Carusone was offended that the gang was described as “attractive” in an article. “Did you notice the word attractive? What the f**k is that doing in there? Is the write[r] a tranny lover too? Or, perhaps he’s trying to justify how these trannies tricked this Bangladeshi in the first place?

Look, man, we don’t need to know whether or not they were attractive. The f**king guy was Bangladeshi,” Carusone wrote. “And while we’re out, what the hell was he doing with $7,300 worth of stuff?

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The guy’s Bangladeshi! [sic]” Carusone also chided police for not advising the public to “stay away from tranny bars, stay away from places [sic] where Eddie Murphy and Robert Downey Jr. have/are visiting, don’t f**king kiss a transvestite, don’t bring a group of transvestites back to your room, etc..”

That same year, Carusone also commented on a male basketball coach accused of sexually and physically abusing his female players.

Carusone dismissed the allegations against the coach in Japan using an ethnic slur.

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Carusone also appeared to praise former Sen. Robert Byrd (D-W.Va.), a former member of the Ku Klux Klan, in one post. He separately wrote that his boyfriend was adorable “despite his Jewry.”

Of course, Media Matters did not respond to a request for comment.

The resurfaced posts came days after Media Matters published offensive comments previously made by Fox News host and Daily Caller founder Tucker Carlson.

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Carlson said that he wouldn’t apologize for his derogatory comments on the “Bubba the Love Sponge” radio program between 2006 and 2011.

Elon Musk Announces Twitter Will Ban Impersonators

Elon Musk Announces Twitter Will Ban Impersonators

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