Meta Platforms (META) 29 Jul 212021 Q2 Earnings call transcript

Good afternoon. My name is France [ph], and I will be your conference operator today. At this time, I would like to welcome everyone to the Facebook Second Quarter 2021 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. will call This Instructions] be recorded. [Operator you thank very much. We Ms. of you may Deborah Crawford, Relations, President Vice Facebook's begin. Investor

you. Thank Good earnings afternoon, Facebook to second and quarter call. conference welcome

Sheryl results Joining Mark me discuss and our today Zuckerberg, Wehner, to CEO; Sandberg, CFO. COO; Dave are

started, update may get XX-Q to like in to with that those forward-looking today's of result press quarterly by call as no differ release you materially would and or these to include forward-looking statements. our take today these information could results on our new from differ to and remarks make SEC. I report set will are events. statements statements opportunity cause on Factors forward-looking as today, Form statements. on remind forth we assumptions Before this undertake of that filed a Any are Actual these that results materially based contemplated future this the we we in obligation

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healthy. I Thanks, hope you're all everyone. safe and Hi Mark.

was So quarter a business. really strong for our this

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Now, to Dave. over

good afternoon, the and Sheryl, continued world. to in the reach results delivered of around services quarter, Thanks, second strong millions our help as everyone. businesses customers We

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expenses; year. to XX% $XX.X total last compared billion, now Turning were expenses to QX up

core and cost to XX%, In hiring increased Marketing products sales and increased marketing hardware consumer driven mainly XX% terms primarily efforts. and partners support increased items, by consumer spend. infrastructure by hiring investments. R&D payments core to revenue of the of cost specific XX% hardware driven our driven and by line

ended and up year. to the mostly in increased expenses full-time last with net hires We new XX,XXX driven functions. XX% We over expenses. added X,XXX over by Lastly, XX% quarter legal employees, costs employee-related QX, primarily compared G&A technical in

representing XX% income billion, operating Second margin. a quarter operating $XX.X was

We cash with billion including our stock Net servers, by ended was cash $XX.X expenditures, marketable leases, was data income infrastructure in tax $X.X network billion. share. or in Class we $X.X $X.XX was $XX.X $X.X per repurchased XX%. were A Capital centers, in facilities. billion office Our the capital investments second quarter, billion the securities. billion and Free quarter rate flow driven of and common and

In terms on second zero our remain reach objectives. our of chain XXXX. Report, we Annual which net sustainability value we In for our our efforts, achieving focused goal Sustainability details our entire emissions to our June, released in work towards achieving

Turning we year-over-year during now increasingly total second the quarter the that XXXX. a significantly increases expect periods to rest decelerate Similar will in growth. growth rates basis, decelerate rates revenue to of a to from driven two-year on lapping outlook. year-over-year expect to quarters growth price and over XXXX, primarily growth fourth to revenue growth compared total second revenue as the year we basis, we advertising the lap the second quarter, be viewing two advertising strong modestly In year third by exclude the of the rate. the recovery, When half impacts we sequential on COVID to expect of

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operations. calls, we earnings in transatlantic potential transfers noted recent regarding to monitor developments impact data our the continue European of and viability As on their

The total consumer primarily and outlook. be range growth from product in technical the prior $XX year-over-year billion, XXXX hardware-related talent, and expect investments by in expenses unchanged costs. $XX expenses we to expenses; our in to is billion infrastructure to driven now Turning of

a Our product growth our we expense opportunities commitment across reflects outlook long-term our see invest portfolio. off compelling to ahead

of $XX capital XXXX to from unchanged prior range $XX estimate. be billion, the to expect our expenditures in billion We

Our data capital network in infrastructure facilities. our and by investments primarily are expenditures office driven centers, servers,

the our services closing, of our innovating XXXX open rate With and use questions. remain who businesses In teens. behalf high pleased business tax call committed [ph], and to We be our are world. the strong let's on France expect in the we up to people around of with the the for that, full-year performance

from ahead, Our Instructions] the Brian Stanley. you. sir. line Please go Thank [Operator Morgan is first with of Nowak question

questions. taking I for my Thanks have two.

Talk make lot of be company next a with opportunity then really years? first I the the for execution of take economy, this reach and need now. sort of this shopping over the creator one going secondly few all there's one Facebook year efforts. platforms thought, Mark, the Instagram larger a to algorithm And And words to you've on of over for key different where been and your on us at overcome a and to sort shopping attacking this areas creator comments meaningful intend sort two you about, sort And content are The meaningful. of platform? economy. more to what Thanks. wild you the really or to about a to bring tonight way it's little some your bit for understand to the Maybe just exclusive help us compete better really creators of shopping

Sure.

tail we we're funnel whole we strategy businesses on, things funnel that, it's both the be with each long commerce shops point of need to that is from main which other messaging increasingly to that making partnerships, that before that's from available and web those building do I business those. tools, we at really different think up of to keep its tools, it and and companies world-class But whether for time so meaningful business discovery way the we ads down a think with do thing or just is services. our functionality do other order the expect want that that take ads that to it and come so I to mind all take on on shops particularly the our scale. that to ads that that through in be I make long On that world-class overall, there I with to anything going the the to is ourselves. we're all layer to going In probably of the means working and work this commerce, own, can is to think across large that e-commerce sure the already basically

this every of starting just going just take to are engage we whether just natively, business that creating think do business, think pretty Facebook a in when that in is So, these or to already one, people the strategy to business are meaningful an coming near people. meaningful or or at, scale our that better that we're But to payment it's on who for driver ad effective experience the it's compound to and information with we're for a terms improvements of a shops, in years. you When go I right using, personalized. better or click be you're doesn't product have a just merchants in There become website you it's or your compounding the that term, while Instagram much whatever WhatsApp think you're to then of going profitability the number of expect and seeing isn't going the shouldn't numbers. terms this the over meaningful meaningful how I realistically, ads using be the But I quarter expect of we this to are. and is in a

guess mean, of want quickly here, I path if are things a you're One your here on a focused second right I this all compounding properties number in be and creator there a that economy. and are to to the this. the to as on interesting question we're get content trying you're and can. for think you're are out there trying of on is as platforms. living, the you we're I different of make on couple these that that are this. creator focused there companies So I'd a yes, different we say

a versus on advantage are one of We long that we an to better like other case not think content we we'll over to make we have the not be what content here them people creators help win do, if can we think that on platforms, term, fundamentally but living another and that than necessarily place. we're have their that creators from lot a over is, going So it's it's do I just make want trying so to to the have platform that another. and best it

tools, the bring advantage are table. monetization I that Our we to pretty think, a big

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lot of be to ability connect in also and people interested their distribution are a an people the recommendations communities to help content. people find going for who personalize We have to their help with

mean I that think So, across be what Reels the we think of long-term of I that able make now. are and going with of important especially doing. think lot going platforms it just why across like, Watch increasingly creators to about some platforms, our both are we're to are systems and our millions we're creators there's the content the going I that we're think and long excited so that, becomes I living is seeing more a to that's that if be important, set healthy breadth on as what a to work over make And seeing term, of is about a able to video

ahead the question. can next and And take France, we go

from Post Our is with Justin ahead. Bank of next America. question go Please

Maybe for one and Thanks question. Mark. for Great. my taking for one Dave

where kind in the from you affecting US on year do you're go all today, were DAUs, how meta-universe. reopenings Mark, and appreciate levels backed and here? penetration you for they QX How of then And commentary on where could Europe. feel really the about First are last activity

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you like Thank the I how -- already you. started. thinking might wondering investments was be if it So looks about around that? able us updates giving to you're

Yes. Thanks, Justin.

in we in a especially where the like bounce given kind On of seeing to slowness, are saw impacted quarter, have obviously, front, sort by we with of of penetration that And noticeable the when to COVID, North expect are Europe, and high markets around our levels seasonal of we penetrated softness, say as of we're restrictions in in of those market. COVID-related given sort might levels do I'd well North then we penetration, quarter significantly as in seeing being how trends ease, combination Delta, going America, level MAU in from some of to America point. And we on and play but you it to Europe. out this read cycle, can hard how the at kind it's DAU that's that's give larger predict DAU this we high trend, that's best other of see I

Sure. metaverse on primarily And the we're points, focused here. on

our social scale, as Before is model, are products company that to you playbook build especially to important want to interact people get get the there. into It's basic who products. I business the with a

parts that of be overall, to of the So having ads building we into part turn strategy use there the that focus big we metaverse embark too. we meaningful media of are will this of a important the it social on the part are what part and is I hundreds be and platforms being do a think the business. and -- people we're as continue to really of this going important I what before going on across probably new But millions the of chapter, next metaverse we an expect and very to

experience a place going I think one to just creators focused digital able themselves lot of is commerce our which goods, going through reasons are I expressing But through through in is we're they this of experience on goods and to with apps their terms current the going to important, that current digital to avatars, one place, the them be they people of increasingly metaverse another. the we're why right, is economy. be be huge, across the have, -- and why to clothing, think to teleport digital around bring being from from that apps

like term, and next and you virtual So investment reality I expect to now us make. economy primarily have focus to develop from to there's and these helping of where platforms should a able who number really is on our I and experience for who be next the very going be that's basically But bring develop place for. grow focus to -- on in goods that's to and that's the augmented people can of we're metaverse your to can people to them and period. that people a think digital inventory And being big be experiences place helping big the what number for going digital be computing your think shooting going the over community, And long the the if in to around this.

many possible. Our to isn't business to or around trying as anything a large devices our going like because model at primarily is around serving be people as that sell premium mission

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the it people the many compound as it. economy as size and possible then inside So digital into of get can

thinking we're job focus, in as to where but investing. at note called kind all a and I the comments our that's a I'm out So the the cleverness at of This happy about to see appreciate to as that can level ingenuity more this, just and about that big looking Dave descriptions this high how I is my beginning. the I to talk will And I'm of and to continue disclosures speak investments. we evolve about expenses that, and

perspective, for focus big a outlook. focus I called expense allocation repeatedly major us our is in Yes. a mean relates overall our area from driver capital out our as we've and investments And on to investment Justin, FRL it in a and obviously, that growth, is innovation,

expect have we dollars we this invest billions of in and annually, the mentioned foreseeable area future. that for So we're to investing

needs As done. of is big make haven't But granularity is on there progress a be towards but computing this lot it we focus, more building next provided any hard work a that we to platform, it.

ahead to please. go the Okay. go question, next and France [ph], you can

with JP Anmuth go is Our from Please question ahead your with next question. Morgan. Doug

the going Thanks Dave. go for two I'm questions. for to

slower Just Is just going growth think ATT comment prices early and you from surfaces changed year? the should seeing of first with that at all about beyond ad the your curious three year. that months here how all? of on the on then we for mitigation create what else the over impression be And driver forward? And anything view on to comps last do could some Thanks. has the inventory then mix And there expanding there? if you secondly, more just efforts if you're your at and thinking past

Yes. Sure, Doug.

at quarter called we for we and COVID a lapping that engagement bigger of of saw factors of lockdowns the remainder driving the impression it. factor there higher growth, terms time, be would was we The related saw are is particularly In XXXX last in mentioned out North that pricing expect that growth pronounced to we'd And where more America, that few last impression engagement the driver a biggest to for growth. year.

is that of one the factors. So big

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within marketplace one ad a growth I we've new Instagram the services like So opportunities. factor you that of both COVID think when more inventory, available are expanding from would We've and opportunity. those And to think Reels then how got on globally I about Reels. begun create would is the forward, impression really factors, seen look services, only say number kind of we're Explore growing ads a when that but things impression I out. We've significant future video, just really is contributions to we broadly make call

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ATT. on question your of terms In

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you can the to next question, ahead [ph], go France go and please.

with next is ahead. Barclays. Ross Please go Our from question Sandler

I on for Dave. a question one the just topic. Hey, or Mark guess, follow-up economy creator

this pays or billion to so the on dollar YouTube $X.XX every So creator, about year. $XX

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or taking A for couple Dave. questions. Thanks for my Yes. Sheryl

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modest Do granularity like helpful? extremely looks modest to just the more are what There can would it mean more Dave, or decel two-year X points more you. stack. questions. add you a your that X you deceleration be Thanks. X, of lot to or or Thank is decel investor any X to

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questions. Two thanks. Great,

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Sebastian Our next go question from Colin ahead. is with Please Baird.

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weakness real a TV as YouTube. been TV has in there Avon going post-pandemic, are to dollars to like And look So impressions. in

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talk I about video ads. can So

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hope safe. So thank today, the call for us everybody on everybody, joining stays and you,

joining you Thank concludes this us. call. for today's conference And

lines. now You your may disconnect