Meta Platforms (META) 27 Oct 222022 Q3 Earnings call transcript

Good afternoon. My name is Martin and I will be your conference operator today. At this time, I would like to welcome everyone to the Meta Third Quarter Earnings Conference Call. [Operator Instructions] This call will be recorded. Thank you very much. Ms. President Relations, Vice may Meta’s Crawford, of you Investor begin. Deborah

to Good third afternoon you. Meta and call. Thank conference welcome Platforms earnings quarter XXXX

CEO; also our Dave portion. Incoming to are and Mark Marne Susan today and our Business CFO call VP and Officer, and Chief Zuckerberg, join are Li, and me Q&A CFO. the Dave for Finance Joining of the Levine, Wehner, on discuss Mark results will

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

to in GAAP both non-GAAP this reconciliation I’d to available are we at A And non-GAAP measures website The investor.fb.com. Mark. of over release press earnings turn During now, financial like accompanying call, is measures. and GAAP investor presentation release. present may the included press today’s an to and on call our

for Thanks joining everyone. Hey, today.

day challenging suggests. volatile trends costs from are apps. have Our economy, engagement has what than that with highest There more On engagement is X.X on ever our about seeing is has of we signal our nearly the I more monthly look seen been, than our specifically, Family people from been positive. commentary region. the billion our also our has of long-term see to the strong. I our grow X apps the bunch and billion to than a speculation X ad apps America number each WhatsApp maybe family, it’s exciting navigate say continue while community actives. North overall, in this to across is Instagram have investments, growing base. billion of service better more Facebook dynamics I trends monthly or some of and And macro are what the than but actives, product billion now trend Apps. people continued a using of grow competition, more some now X We fastest daily increasing some loss that from Across quarter. the saturated large some countries growing And reach to demographics, continue some we

And product also Reels. We especially seeing shortly. when share I more that priorities engagement are about strong details discuss I’ll grow, our in growth

on our revenue of terms In quarter this grew constant business, slightly currency a basis. total

economy We said are revenue that we that believe clear we be, the will not That still year. it’s yet. healthier where behind I to trends but next think growth has should return stabilized we

areas. focus priority our planning conservatively. on small are we high investments more of we budget going to So XXXX, our a In growth somewhat number are

the the are our and XXXX messaging doing platforms we AI to So ads on and flat these and a we leading shrink are engine focus even on with of suggest future slightly powering experiences, are or are or that and the other that’s going are have metaverse. recommendation work The seen same means teams but meaningfully, for size the next organization will indications year. track business areas to vision that investments. discovery internal other Reels I our right our we primary In most teams will today. over expect some we grow Three end smaller the stay than either aggregate, roughly as

that I investing should in So keep areas. heavily these think we

As infrastructure income operating AI company investments, Apps Reality with income I such long-term. our we that Labs before, is in shared the even of overall our grow goal our operating and Family grow can to have still meaningfully

current to in our is we percent and to surge the AI due long-term. revenue as building out down would expect come largely infrastructure over of CapEx Our a CapEx

which the will achieve we growing broadly, We can first XXXX, has consumer are launch salaries of year of of again operating expect ensure hiring full going that being goal headset that but Reality the Labs that expenses investments paying our we to been beyond next in year. in company increase XXXX, to XXXX, of the overall Reality Quest Labs the to More our with expect we be meaningfully biggest pace and income. drivers generation for of done next

Our return of capital capital to Apps is Family these of generated long-term allocate the the portion the greater while to a from towards areas allocation philosophy profits over Alright. enabling future-focused of a shareholders.

these Now on product areas. we are in I’d some like that to share seeing the updates progress

role to and an our us interesting driven just advances from especially follow. important discovery accounts primarily AI and playing you networks the be more that across is enable feeds products, by recommend used engine our Our as content to increasingly across people

ago. than of trends Reels which good production across Facebook expect like continues each our both I apps. Instagram time things competitors XXX TikTok. apart day. billion XX% increase includes Over grow and on apps, our are to Reels, a course, quickly in months to our spent look spent time X and consumption. this, are now and that is share The Reels from a There few products incremental on time, we here. So across we That’s to more set plays gaining here believe

types allows content videos our well, long-form short to photos, of work Reels as more. including and all that text, links, engine communities, discovery recommend beyond and us is First

this – and friends, is Second is social messaging. generated content more to interactions alone. AI mix which posts And by we that can your from family can’t alongside posts move be along third

billion people make to that going times alone, day these We discovery a are apps through are DMs. X On and between stronger. Instagram flywheel Reels developing reshare a messaging already

run-rate. to the or Feed the in I’ve how Stories of doesn’t means challenges short-form yet. past a That – video more expect discussed billion $X Reels of of near-term the to is with growth rate take next creates also Moving that headwind monetize made, as Reels still had since $XXX the Reels monetization, neutral at are displacing the gap months. monetizing thing this are the we revenue do, million shift, quarter to Reels have a but Instagram more we priority. right this quarterly but to revenue to grow Even progress that with choosing And grows, demand than higher a we so that XX high we closing surfaces. revenue is over with seeing, I are we to this a sort get last the XX clearly can I think crossed mentioned place from XX annual

We apps continue these scaling is across run-rate monetization across $X and billion. both Instagram and the now Facebook combined

communicate that We billion just with $X Messenger, on Instagram opportunity. $X.X which click or first, in is we millions can ads this to but Paid Beyond is valuable monetization smaller into. we ads Billions people major that started run a WhatsApp ways we another more started a are from is growing experiences. they grow businesses Messenger rate Reels, Instagram messaging And ads one so opportunity Messenger starting than base. confident fastest tap And growing of click-to-messaging continues it and a Direct, on WhatsApp run-rate. and lets customers XX% to a there start annual mostly directly. products our that today year-over-year. with can to of run click passed connect another this with is since use to we WhatsApp messaging of that and create Facebook on them threat and are but businesses billion And everyday and revenue quickly,

questions main putting customer place in sell partnerships now in messaging chat. on use chat-based the for And which with experience this WhatsApp also foundation platform directly that we lets the as commerce on are all in launched through India, shows our end-to-end potential service JioMart WhatsApp We and it’s and answer to shopping messaging. first and updates scale their to Salesforce, businesses like key the

work road reality am work experience, we and am So today several clearly platform; undertaking. deliver am conference of the leading we well a We be this business. and management the a on just create entirely paid enterprise more. next going a work enable be our Microsoft, we announced The and before more their gaming, their their for is Connect is creative that solutions we people but announced our our blend really last looking new PCs. had messaging, tools; lives And productivity is area I of to confident even of There million and a the work. I years is between to all big new a versions with opportunity. Quest and mostly Autodesk take metaverse. I people discuss This to seeing way the click-to-messaging often physical mixed Accenture the and that Quest environment Work technology done the great the to interact foundation to but of And want new than in long our high-resolution new going eventually Zoom long-term Pro. more they people each delivers in it’s excited It’s reality their with Quest it’s enable Quest; I that massive this VR Pro as doing objects get year, is to bringing that And for when the get work. XXX to shipping. into over platform, an build of pretty you. I for virtual forward virtual a about our theme started and to and every computing ahead our big of mixed importance as which to bringing better and next that headset build It’s into new that high-end partnerships line other blend think metaverse what around going the amazing communication going work just so could Adobe kinds services suite with mainstream, the fitness historic foundation become is productivity capability. enterprises bringing it, Pro, still they and are and PCs you socializing, goal are for and will There for is here see each can these to here. few to And product and who experiences for building you

future the focused help business our messaging us those tougher So ads the of navigate driving engine, are areas will and stronger discipline metaverse, we and platforms company. discovery I even the we an on. across AI between the believe that and and emerge that current are vision for prioritization, that the efficiency organization our three the are environment

for Meta journey that, hard work at As to and Dave. with always, And it all your us. everyone I to am being turn for you going am this to on grateful to of over with I

Thanks, Mark and afternoon, everyone. good

basis, approximately a currency our consolidated This includes footprint up been otherwise comparisons would rates anticipated exchange total impairment $XX.X align have QX a X% $X.X our expenses needs. basis. operating on with to remained certain $XX.X with billion, XX% unless are results. total billion, facilities revenue were to begin year. office our Let’s as ongoing a of last QX higher. $XXX part compared foreign revenue work of or All noted. million was year, constant leases operating up on total X% billion year-over-year our last down Had QX constant of with

decreased specific X% in increased as of in the well was line content-related Labs a as by R&D growth hiring and driven cost offset segments items, Labs of Reality Apps XX% by infrastructure Labs revenue costs Reality expenses. of within technology terms as Family costs. Reality hardware development and In reduction mainly

increased costs. Lastly, sales X% respectively, by and and driven XX% mainly marketing G&A and headcount-related

new Our a consistent added third our stated with in down additions period. from hiring previously X,XXX We pace net slowed QX, hires in plans. the seasonally despite QX stronger typically net QX of our quarter, X,XXX being of hiring

section. next to which forward flat year cover to expect my will hiring dramatically to going headcount and current roughly hold We levels, in relative I outlook slow

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

centers or Capital and $XX share. third including data in marketable per $X.X were Our was infrastructure. $XXX ended completed billion cash repurchased $XX.X quarter billion Net common payments principal was and tax A rate leases, cash $X.X $X.X was servers, million. $X.XX Free billion with our network by XX%. driven of of income investments on flow and Class offering the expenditures, finance debt inaugural the We stock We quarter an billion. billion securities. in in

segment. now Moving Family results, I’ll with to segment begin our of our Apps

billion, X.X billion XX.X. headwind quarter basis. the total up lapped of to first the billion, used in people grow. users grew and on approximately Family ATT on to X% in was and to September September. monthly million X.X revenue currency Our down or QX compared X%. continues engagement ad Facebook Apps Apps year. active people X% year. Family in daily QX revenue represented Consistent on DAUs the estimate users X.XX XX one billion X% iOS Facebook used community to XX year-over-year growth across that Apps Apple’s a down billion, we daily approximately active changes $XX.X least our from one that of $XX.X of of constant of last compared remains diminished the monthly full at grow continues XX% the QX MAUs a our We with expectations, billion but Family strong. of launch Apps Family a basis as last least was X%, to or approximately basis. at up X.XX were globally post million of

was weak believe demand, this which However, we macroeconomic to volatile by by uncertain be continues landscape. and advertising the offset impacted

our growth in rate. healthcare The QX and growth travel currency positive result, our to line in a the were QX. with rate largest constant contributors QX was verticals As

including this from size advertisers advertiser challenged, online continued among was offset revenue verticals, an softness basis, However, we by smaller resilience growth CPG. and gaming, services large other have financial in On more seen advertisers. while commerce, remains

meaningfully strong driven was growth X%, offset advertiser Asia-Pacific growth depreciation messaging rest from decline line served of across North currency of America and number a XX% respectively, from was a X% regions growth strongest average Asia-Pacific especially surfaces demand. driven revenue price and services basis, in at per international benefit Europe to headwind was monetizing lower currency other was and significant and ad in driven $XXX revenue In and our our respectively. strong click-to-messaging lower of rest XX%. both regions. ad all geography the growth million, impression world. platform, continuing pricing revenue business in Impression to X% items. ads. from the declined X% and increased XX% total primarily by year-over-year by impressions was QX, WhatsApp advertising Apps in ad The decreased growth and decline and partially world business foreign by On year-over-year Foreign regions, with other user Family of in by a strong up growth,

investments continue primarily XX% Quest to direct employee-related expenses expenses technology our impairment for of to $XX.X development costs billion. towards XX% QX, Reality billion, million, FoA segment, the our we office was were operating exit. were was infrastructure-related Family expenses. costs, the to and of to $X.X Apps our a QX by We Apps. was of driven of billion, development Family and operation plan Within representing loss operating $XXX and employee-related our XX% of due lower $X.X grew expenses. majority In $X operating due representing of up Apps overall expenses leases that Family revenue XX% margin. mostly XX% certain the Reality Reality of facilities operating Labs X Labs income Labs sales. down billion, costs

the now total billion. expect revenue $XX be in outlook, $XX.X Turning we quarter to the billion to to range fourth of

current on Our quarter to an in guidance growth headwind be approximately will X% exchange year-over-year based revenue total the assumes fourth foreign currency rates.

on I the the towards our Before provide turning budget. expense approach to taking XXXX wanted setting some outlook, to are context we

across more We are efficiently. making board to significant changes the operate

investing headcount shrinking our holding are in of others headcount, flat in growth priorities. highest teams We terms some only and

in be quarter line at the As of XXXX third with a XXXX headcount result, will approximately levels. end we expect

operating expenses. scrutiny on all increased have areas of We

a play in cycle, follow moves time investment out expense overall to of so will these take they terms However, our substantial trajectory.

should ongoing the well like to steps, when expect our growth. costs in we This Some set years the lead rationalization will revenue to us incremental to rates higher of office for of up footprint, future near-term. return

for we This $XX the fourth will expenses ‘XX This estimated billion. specific billion XXXX facilities anticipate includes be the that office related related XXXX. $XXX our in our We expect of outlook to of billion updated consolidating to be to range to additional XXXX the total expenses our to ‘XX, now in an billion expect consolidating facilities from billion. includes footprint range year $XX of to we record $XX million QX billion charges quarter in full $X of $XX in the to our outlook $XXX Turning prior expense an estimated to in charges and total in $XX billion footprint. office

dollar revenue. slight with expense majority coming XXXX expenses, of from expect the driven our growth operating the remaining We by growth be to of cost

We XXXX cost to roughly accelerate and keep and non-headcount with lesser headcount extent, decelerate by are Reality to in expenses the that related operating expected losses meaningfully grow XXXX headset our levels. costs our Reality a operating expense Conversely, our by is launch will next rate expect growth in hardware of as of to We later our next curtail revenue infrastructure-related expenses the guidance. we of of percentage growth Quest do Labs included consumer expense current XXXX total Labs growth flat year-over-year. driven in Labs significantly Reality year. anticipate generation expenses, driven

run. XXXX, overall our achieve income that goal we growing Beyond investments pace can company Labs expect of in to Reality such operating the we long

infrastructure to I’d our to CapEx turning Before investment provide some approach. context outlook, like on our

by investment We driven areas is driven two which large are which currently – investment. is an through going being cycle, of primarily

It building AI. support our new are intensity is AI infrastructure expenditure with and XXXX. AI and capital significantly moving next-generation comes are hardware. servers to driving of our more more our investments data expensive growth expanding we networking in of requires are specifically There centers to capacity. equipment, that increased These First, equipped some we substantially capital all

a meaningful provide many our and of investments us Reels initiatives, to including Ads. key expect advantage We and technology improvements these Feed, unlock across

We will are AI investments, beyond scale evaluating the the carefully of inform these our investment achieved from return we which XXXX.

are capital our more have Second, online. for provide revenue us XXXX of the capacity types investments to expect in bringing we in cost us we greater use time. up center capacity ongoing center believe the investment And are data flexibility we years, footprint. percentage We along and in will of to data which that in is greater stepped we contributing our allow In higher the and center than additional making data ongoing XXXX. recent XXXX work servers generate expect revenue investments, headwinds, them we a to efficiencies over over purchase These longer, expenditures as with long-term. with

Turning now to and ‘XX the CapEx specific ‘XX. for outlook

payments We the finance $XX updated in billion prior capital billion from expect to billion XXXX on range of $XX billion. leases, including $XX to $XX our principal expenditures, be of to range

center to capital expect the substantially driving is we expenditures driven be XXXX, For servers network data investments increase in billion An of range of capacity by all expenditure capital XXXX. AI and in in to growth billion $XX in our $XX infrastructure. our

Absent expect to similar rate any XXXX our we U.S. to law, fourth to third be XXXX changes tax Turning the our tax quarter to and year full XXXX tax. rate. quarter

calls, their Reels we the such and impact and are are of closing, the In regarding with operations. Apps with recommendations. efforts addition, we our viability the community growth AI-powered noted transfers on of potential engagement content and improvements driving as on our monitor data transatlantic Family pleased continue European to our previous the developments using as we of In

the on are near-term there top a return fundamentals headwinds revenue, for facing While line growth. to we stronger are

company set the driving with up moves optimistic We looking income us goal efficiency discipline, our open off one of be CFO and achieve financial mission help happier is of a couldn’t and and note, weeks, decade hand spending next over the forward on executives career XXXX role to Martin, long long-term for Question-and-Answer Session And I’ll to had execute years are new growth and On to with that the most call well achieve Meta who that, will I the closing on tech. operating I’m these approaching to a questions. my talented Susan in the I’m up work in the Li, CFO. to growth. the be I’ve in investing chance for as finance long-term while a at of continuing including plan. In that to out X couple personal last role, its with its future me a let my focus

of [Operator line question And your you. the Nowak Morgan with Instructions] first from comes Stanley. Thank Brian

I for could Thanks in If questions. taking two. squeeze my

forward expected. The expectations first one investors return invested higher on are capital. and The is somewhat remaining CapEx and on CapEx than spend

the incremental So incremental incremental about investors you examples time from interesting. in what what’s us spent Mark, oldest just investments period time to these? some differently durability going can these platform material reasonable AI any update trends expect the the forward one spent, in And going topic on to around of engagement. to sort investors confidence or big than some spent new do on in second look revenue see thought sort comments your I are Thanks. maybe the can maybe is were of Reels address But you to enable give your of what time U.S. give us which past? like market? a And from of just in just the engagement give to you then

spent first, question. why question it the time to Hey, I off hand and the I’ll Susan then don’t take CapEx Brian, on

seeing spent, spent. And time what to are as Mark is we on we’re time really with on engagement. mentioned, Reels incremental So pleased

both Specifically, and U.S. of up time spent in in and aggregate are both the terms and year-over-year Instagram Facebook, globally. on

of tilt we’re more optimizing short-form we time trends content. tend to while towards are spent for video, and actually And focused specifically longer-form spent, So time specifically other and that us optimizing because for positive. not on types those we’re aren’t would

And CapEx on to color take you do want question? time the some just Susan, So spent.

Yes. Thanks, Brian.

all range $XX be Dave in driving of expect to as billion, to his of growth. mentioned our billion in $XX with script, we that in So CapEx AI XXXX the investments

had call, continued a we’ve AI in work. XX% ROI our products time strong shared advancing recommendations But level investments, We’re time work. our to Reels, from improvements coming that single and and expect very gain a focused our that’ll to that there models far, evaluating has watch scaling the from In be spend. will advancement recommendations seen that developments Facebook AI our for impact AI grow. in our on watch QX so led of additional of we future the had And on gain we continued that inform

the examples On and seen. to in also AI ad all we’re encouraged side, that continuing more early improvements of some new ML offerings, and we’ve of roll the ads the we’re out by

is in engagement We that something this investment So generate that we significant we generate think our will spending CapEx investments our if here. of if and depend we the continue don’t, pace AI. we will through we’re be revenue accordingly. closely. level will investing gains, And watching And very on but we we journey, early this returns will in these

of question the Mark with Shmulik next Your comes Bernstein. line from

to back that macro-driven can Yes. A you revenue of Hi, initiatives Thank some kind XXXX. And to opening kind know those historically, growth the share the of you expect key on into remarks is tended excuse core? kind health couple, thanks of of you some of you. may. how of to get taking that as working kind on in of a of bit there much How question. expenses I for toggle flexibility me, And conservatism color think for then much of is you – conservative. secondly, mentioned in numbers that? the if Mark, first one, in XXXX, the we behind is expense these baked And that are operating have much guidance about depending your versus Any guys drivers I to those on? the skew there? how Susan, kind

first continuing there the Mark, significant see headwinds do I’ll business. in So cyclical it’s to think take We macro big here. the factor we’re a Obviously, Dave. question. is

ads, of is recovery we’re ads make markets. which macro it’s through in extent some that’s tough It’s going has a as those, good run we today, number of one a to on and economy of broader rate see. in in make the focusing just billion cycle. areas of solid cited areas of is overall number depend progress number we we’re which And we’re developing continuing some grower. terms a going overall, it of on fronts, especially and that a to Mark and click-to-messaging click-to-messaging growth, this on But $X important the revenue been progress been revenue to So, continuing to on we’re of And is a driver depend like. climate the but as get what on some seeing grow to progress a to

We’re significant headwinds we as lapping that from next view point not big platform. facing to of going made be signals now iOS the the as the year changes are were on

rates So factor to not in as growth also strongly that’s going year. in our next

are estimated one-time our as our rationalize to we consolidation OpEx real out I’ll in expenses next $X second year’s charges XXXX guide. I’d an that One footprint. as on part of just take continue that And thing question includes point office first is next facilities estate billion guide year’s

We rest to over from growth come in XXXX dollar coming a also little half of of expense from cost the revenue. expect our with OpEx,

by costs hired headcount-related technical and from XXXX, through already the On hires driven concentrated primarily OpEx those OpEx and side, employees we’ve that senior have XXXX the been is more in in roles. growth primarily

in growth slowdown overall. So growth the we XXXX expect the the slowdown be headcount result in payroll in will of

the are As we by end of we to flat to driven in XXXX the the now. side, expect to revenue revenue with big from ‘XX where year. next rate of headcount cost And well of through of launch seeing we’re far play as and CapEx the then with later generation so the next made we’ve that consumer as depreciation that investments Quest increased Labs the of from accelerate we growth the mentioned, on expect roughly headset we cost Reality

line next of Post Justin of with Your from Bank question the comes America.

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is the time So Justin, Mark incremental Reels transition, as noted, it on spent. to

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our about question CapEx and components. second kind think the your I non-AI investment of really the would about AI on as CapEx And guide,

of side, pacing the measure. be we’re to the basis able on driving of the XXXX, will returns future that and in all really the On AI growth is see which CapEx investment we that

a investment opportunity big a more be of area hopeful for because to that that invest this we will will So there high ROI frankly, here be expect we’re us.

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we’ve are done two that to comparisons I anchoring worth past year the think on. the are in that things there

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not gap So obviously, tailwind, we a to want as this headwind. want We close to as monetization possible. a quickly be the

and to It’s going just we’ve that’ll gone – we’re time. these get there. think a think some transitions, I I through take of think I few but

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is We things So well. we we of – part going should be think that results. think we will continue able to driving

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comes the of Doug line Your with next JPMorgan. from Anmuth question

ATT versus lap function of structure improvements you around revenue you’re and efforts formats ad the attract does And Thanks second, can Curious Thanks. impact if margin talk the surfaces? you I creators impact Dave, XQ content about seeing a any two. your in the comp to meaningful just for just dynamic? Reels? your question. to current sharing the diminishing you as year-over-year this rollout. talked have just then taking ATT. is the And about Or

– relative we’re the impact, to ATT is factor lapping of terms primary the factor QX. in So

been So out. in QX not by XXXX, ATT fully It of rolled ‘XX. of had was out largely QX rolled

third but macro we that was that offset weakness. fact quarter, period by the a second the benefit continued were So the quarter, got in that relative to we lapping

it our creators, to obviously, and to of to impact going it’s as cost overall guidance. to structure. factored into meaningful expense In efforts terms anticipate structure, content relates a the the specifically don’t the attract that, that’s we have And cost

with next comes of from line Sachs. question Your Goldman Sheridan Eric the

two, next the can metaverse to be on ask medium cause the non-hardware elements the as long-term? curveballs the opportunity externalities on over in it the with XX platform, versus cadence own cycle to opportunity investment lot the you Thanks destiny I How investment a the you’re from can. thrown And at much I future-proofing and as control should of revenue in. the I’d see you to impact, of as for around years, taking to Mark, and Maybe macro it views qualitatively, investors that platform Obviously, are about can informed love years that can in that if over think X volatility XX months. metaverse weigh of less impact company Understood faced last question. opportunity competitive metaverse. the the if one between talked so by in love next how the your dynamics this headwinds evolves? X business you the even lot of changes, then would about over we’ve X to your the has in the and of hardware more a is there the

Sure.

the Let’s – take second one, can I mean could then I – too. one first I the I take and guess

So, the this… what was question first was –

of the… How much

Yes. Right.

Okay.

So, factor, primary the it. it’s but not I think that, that’s thing a driving that’s

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And question Squali Youssef from Truist. next of the line comes your with

you the guys with strategy when assumptions expectations? next decided is you of gating Mark, own and evolve company’s much. one Maybe relative or to-date with Dave kind Susan your ago, of And performance Mark. to in are line then the guide Great. metaverse for changes against a talk the pursue that year? What can not, XX% base what the could things macro couple engagement any expense rate material your maybe would – to in case to the baking you. expectations how of macro in, very Horizon you you in product etcetera? terms for Thank opportunity guide? with factors? question key in are World, to rollout, for if XXXX one And like in And XX% years Thank about and components And versus the the flexibility that increase you give you address OpEx for fixed variable CapEx

Hi. on question. the It’s Susan first

revenue for range, a that QX XXXX certainly given guidance wide expectations. of our We haven’t think macro range I yet XXXX, and but guide encompasses, variety is a

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higher of of our what areas anticipated the XXXX and an approach with almost budget we our So, to that mind, conservative our broad and investment have has taken to undertaken scrutiny applied is all more very process have in we a that intentionally growth. budget portfolio,

of the the components XXXX about You of OpEx fixed guide. sort variable asked versus

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is So, that employees hired. in corresponds then have side, OpEx sort who on coming growth the from to the launch. a XXXX And we of OpEx we – lot product of the already

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as technology to are have end here think more much more in well. and have being that’s up And that and them. that, similar going workstations We computers I powerful

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private. that’s something you Sometimes to more are going want

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from ISI. comes Mahaney with Mark Evercore question next Your the line of

question. and want trying much long new, It’s the I company can for ad I to the I of model, priority. I of to or is And major create This a back follow-up the how as to based on mean out hear a company the ad am a of something prior figure a I kind ad business. call, And took don’t had it priority probabilistically billion out investment it probabilistic a maybe to listening it how on don’t thinks financial take that targeting your to know, recover model. material just is attribution $XX impact. tools.

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will I take this Mark, Hi question.

to tech. broader of our continued ad have We work our elements meaningful rebuild

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the our more portfolio of that. we help And also do spirit Over in of technology is industry of own both working the investing longer this but to advertisers the term, with are in focused in on to solutions, all investing technologies, get value. privacy-enhancing this

Marne. Great. Thanks

have time We one last operator, for we question. have –

Jefferies. Thank you. Brent of That with Thill from the will line come

I of are up now curious too feeling feel investors you just experimental. I bets these add on that are there you how experimental summing more right color proven can just core. think kind many am is versus bets why are the don’t if

focus they a I You you everyone and off. to obviously off. think pay this why on of is think lot hear side feel pays love investment There like the

Yes.

of the of across I we outlined a number Let are the space. investments and some take terms are think the will Reels least making a ad platform in we making part have of we business, investments ones for that Marne we the at areas that and that product WhatsApp me messaging Obviously, in in both the portfolio. that. like engagement making in are monetization. are significant business – payoff mean at

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ads We proven already click-to-message our it complement business a our $X billion have a with business around We business we with out will today. that can build think – sized as which substantial paid well. messaging,

work addition we metaverse. got portfolio think Family bets of Apps have the I Labs of a across Reality we the are on doing So, to in and the lot that

right kind in set metaverse work we the these that Reels end is I direction. up mean being. Yes. But say they the lot the it’s ads and be. are experimental efforts knowing scale a a and things to between term are how of confident I think on are I I that there much good. work going of working to is how big right each Family the good don’t the I on. to of that signals, something the quite just all on you But work, to difference that are a – they work, working are across going that we how engine work, work think The going Obviously, longer going be of discovery being tell now we the know. Apps But not can’t are things business of messaging are we

going to too. I that, up think that end working, is

that, different lot things think look, of number the of – now in a a are going I there yes, are the business So, on right world. there in and

they end And I going expenses returns taking invest of are being we rewarded. There patience. some Apple. then And to the to solve issues. over are believe challenges, those and I because will over And periods are have, term so I we that do I appreciate to longer coming different we macroeconomic patient hard lot that’s of going to thing, of things time. these ads There on there a going going And competition. us are a and there up like, with the think that of is we things the greater is who to from And issues. it’s each one time. especially is provide this mean are are simple resolve all that think

said, strong what investment. economic is a the return Just they adding is challenging to time what are on Mark just it focused a advertisers. uncertainty given getting for on And

strong great we Family the discover Facebook, and a people connect What Instagram the with be way interest are of format saw ROI business-as-usual added focused in brand strategy businesses. drinkware are that that we on get and is new sure on a and fastest-growing on insulated making businesses terms that of shows the a its back return to is XX% Going Reels. to spend And to Reels for that sales. which on investments our to it a and ad is XX% continues delivering one creators Corkcicle, services, example Reels higher is Apps this higher on and and

we are our and with helping advertisers that looking Q&A of find that progress So, investments making they are for. End ROI

and forward everybody Great. time us you speaking appreciate today. with for look your Thank you to we joining We again.

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

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