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科技巨頭業績炸場！哪些交出超預期答卷？
富途研究
joined discussion · Oct 25, 2024 17:39 ·

Futu Research | Meta24Q3 Financial Report Preview: Performance expected to exceed expectations.

Author: Chancy Chen, Licensed Analyst
Meta is about to release its third-quarter financial report after the market closes on October 30th, Eastern Time, with extremely high market attention. According to Bloomberg's unanimous expectations, the company's 24Q3 revenue is expected to increase by 17.83% to $40.235 billion, and diluted EPS is expected to increase by 19.22% to $5.23 year-on-year.
Meta's stock performance this year has been very outstanding, with a price increase of over 60% since the beginning of the year. It is expected that Meta's performance this quarter will still be excellent. How should we plan our investment strategy?
Author: Chancy Chen, Licensed Analyst Meta is about to release its third-quarter financial report after the market closes on October 30th, Eastern Time, with extremely high market attention. According to Bloomberg's unanimous expectations, the company's 24Q3 revenue is expected to increase by 17.83% to $40.235 billion, and diluted EPS is expected to increase by 19.22% to $5.23 year-on-year. Meta's stock performance this year has been very outstanding, with a price increase of over 60% since the beginning of the year. It is expected that Meta's performance this quarter will still be excellent. How should we plan our investment strategy? 1. Advertising business is expected to be strong, supporting the company's performance to exceed expectations Advertising revenue is META's main source of income. It is expected that the company's advertising revenue growth rate for this quarter will still be able to maintain a high growth of around 20%, with the advertising revenue growth rate of the previous quarter at about 21%. The reasons are as follows: 1. The strong support of the US economy continues to drive the growth of advertising revenue. Based on the macroeconomic data of the United States in the third quarter, the retail rates in July, August, and September all achieved month-on-month growth, with a 0.4% increase in retail rates in September compared to the previous month, higher than market expectations. This indicates strong consumer spending in the United States, with virtually no substantial signs of downward trends in the economy. Supported by a robust US economy, advertising prices are expected to continue to rise, and it is anticipated that the advertising revenue for 24Q3 will still perform very well. Chart: US retail rates as of September 2024 (%) Source: U.S. Census Bureau...
1. Advertising business is expected to be strong, supporting the company's performance to exceed expectations
Advertising revenue is META's main source of income. It is expected that the company's advertising revenue growth rate for this quarter will still be able to maintain a high growth of around 20%, with the advertising revenue growth rate of the previous quarter at about 21%. The reasons are as follows:
1. The strong support of the US economy continues to drive the growth of advertising revenue.
Based on the macroeconomic data of the United States in the third quarter, the retail rates in July, August, and September all achieved month-on-month growth, with a 0.4% increase in retail rates in September compared to the previous month, higher than market expectations. This indicates strong consumer spending in the United States, with virtually no substantial signs of downward trends in the economy. Supported by a robust US economy, advertising prices are expected to continue to rise, and it is anticipated that the advertising revenue for 24Q3 will still perform very well.
Chart: US retail rates as of September 2024 (%)
Author: Chancy Chen, Licensed Analyst Meta is about to release its third-quarter financial report after the market closes on October 30th, Eastern Time, with extremely high market attention. According to Bloomberg's unanimous expectations, the company's 24Q3 revenue is expected to increase by 17.83% to $40.235 billion, and diluted EPS is expected to increase by 19.22% to $5.23 year-on-year. Meta's stock performance this year has been very outstanding, with a price increase of over 60% since the beginning of the year. It is expected that Meta's performance this quarter will still be excellent. How should we plan our investment strategy? 1. Advertising business is expected to be strong, supporting the company's performance to exceed expectations Advertising revenue is META's main source of income. It is expected that the company's advertising revenue growth rate for this quarter will still be able to maintain a high growth of around 20%, with the advertising revenue growth rate of the previous quarter at about 21%. The reasons are as follows: 1. The strong support of the US economy continues to drive the growth of advertising revenue. Based on the macroeconomic data of the United States in the third quarter, the retail rates in July, August, and September all achieved month-on-month growth, with a 0.4% increase in retail rates in September compared to the previous month, higher than market expectations. This indicates strong consumer spending in the United States, with virtually no substantial signs of downward trends in the economy. Supported by a robust US economy, advertising prices are expected to continue to rise, and it is anticipated that the advertising revenue for 24Q3 will still perform very well. Chart: US retail rates as of September 2024 (%) Source: U.S. Census Bureau...
Source: U.S. Census Bureau
Chart: Year-on-year growth of average global advertising prices from 22Q2 to 24Q2 (%)
Author: Chancy Chen, Licensed Analyst Meta is about to release its third-quarter financial report after the market closes on October 30th, Eastern Time, with extremely high market attention. According to Bloomberg's unanimous expectations, the company's 24Q3 revenue is expected to increase by 17.83% to $40.235 billion, and diluted EPS is expected to increase by 19.22% to $5.23 year-on-year. Meta's stock performance this year has been very outstanding, with a price increase of over 60% since the beginning of the year. It is expected that Meta's performance this quarter will still be excellent. How should we plan our investment strategy? 1. Advertising business is expected to be strong, supporting the company's performance to exceed expectations Advertising revenue is META's main source of income. It is expected that the company's advertising revenue growth rate for this quarter will still be able to maintain a high growth of around 20%, with the advertising revenue growth rate of the previous quarter at about 21%. The reasons are as follows: 1. The strong support of the US economy continues to drive the growth of advertising revenue. Based on the macroeconomic data of the United States in the third quarter, the retail rates in July, August, and September all achieved month-on-month growth, with a 0.4% increase in retail rates in September compared to the previous month, higher than market expectations. This indicates strong consumer spending in the United States, with virtually no substantial signs of downward trends in the economy. Supported by a robust US economy, advertising prices are expected to continue to rise, and it is anticipated that the advertising revenue for 24Q3 will still perform very well. Chart: US retail rates as of September 2024 (%) Source: U.S. Census Bureau...
Source of information: company announcement.
2. The online advertising industry's market share continues to expand, benefiting META continuously.
The global online advertising market share continues to grow. According to relevant market research data, Meta's advertising spending in 2024 is rapidly catching up with cable television advertising spending, and is expected to surpass cable television advertising spending in 2025.
Chart: Global, Meta, and Cable Television Advertising Spending (Billion US Dollars)
Author: Chancy Chen, Licensed Analyst Meta is about to release its third-quarter financial report after the market closes on October 30th, Eastern Time, with extremely high market attention. According to Bloomberg's unanimous expectations, the company's 24Q3 revenue is expected to increase by 17.83% to $40.235 billion, and diluted EPS is expected to increase by 19.22% to $5.23 year-on-year. Meta's stock performance this year has been very outstanding, with a price increase of over 60% since the beginning of the year. It is expected that Meta's performance this quarter will still be excellent. How should we plan our investment strategy? 1. Advertising business is expected to be strong, supporting the company's performance to exceed expectations Advertising revenue is META's main source of income. It is expected that the company's advertising revenue growth rate for this quarter will still be able to maintain a high growth of around 20%, with the advertising revenue growth rate of the previous quarter at about 21%. The reasons are as follows: 1. The strong support of the US economy continues to drive the growth of advertising revenue. Based on the macroeconomic data of the United States in the third quarter, the retail rates in July, August, and September all achieved month-on-month growth, with a 0.4% increase in retail rates in September compared to the previous month, higher than market expectations. This indicates strong consumer spending in the United States, with virtually no substantial signs of downward trends in the economy. Supported by a robust US economy, advertising prices are expected to continue to rise, and it is anticipated that the advertising revenue for 24Q3 will still perform very well. Chart: US retail rates as of September 2024 (%) Source: U.S. Census Bureau...
Source: WARC Media
3. Strong Social Ecosystem Advantage
Meta owns globally renowned social software such as Facebook, Instagram, WhatsApp, etc., and holds an almost monopolistic position in the social ecosystem. With such a large user base, according to data from Q2 2024, the active user count of apps continues to steadily increase, reflecting a strong social ecosystem barrier. Naturally, Meta with its massive user traffic has become the top choice for many advertisers.
Chart: Daily Active Users of Social Product Family from Q2 2022 to Q2 2024 (Billion)
Author: Chancy Chen, Licensed Analyst Meta is about to release its third-quarter financial report after the market closes on October 30th, Eastern Time, with extremely high market attention. According to Bloomberg's unanimous expectations, the company's 24Q3 revenue is expected to increase by 17.83% to $40.235 billion, and diluted EPS is expected to increase by 19.22% to $5.23 year-on-year. Meta's stock performance this year has been very outstanding, with a price increase of over 60% since the beginning of the year. It is expected that Meta's performance this quarter will still be excellent. How should we plan our investment strategy? 1. Advertising business is expected to be strong, supporting the company's performance to exceed expectations Advertising revenue is META's main source of income. It is expected that the company's advertising revenue growth rate for this quarter will still be able to maintain a high growth of around 20%, with the advertising revenue growth rate of the previous quarter at about 21%. The reasons are as follows: 1. The strong support of the US economy continues to drive the growth of advertising revenue. Based on the macroeconomic data of the United States in the third quarter, the retail rates in July, August, and September all achieved month-on-month growth, with a 0.4% increase in retail rates in September compared to the previous month, higher than market expectations. This indicates strong consumer spending in the United States, with virtually no substantial signs of downward trends in the economy. Supported by a robust US economy, advertising prices are expected to continue to rise, and it is anticipated that the advertising revenue for 24Q3 will still perform very well. Chart: US retail rates as of September 2024 (%) Source: U.S. Census Bureau...
Source of information: company announcement.
4. AI Improves ROI for Advertising Placement
Meta has been using AI to improve the way it targets users for advertising, thereby increasing the efficiency of its most profitable advertising business. In recent years, Meta has introduced the AI-driven advertising tool Advantage+, which uses AI and automation technology to help advertisers improve marketing and promotional efficiency, thereby increasing advertising ROI.
In addition, Meta's AI technology can also achieve precise ad targeting and intelligently optimize ad performance by identifying key factors that impact ad effectiveness through real-time monitoring and analysis of ad data. These algorithms can dynamically adjust ad content and delivery methods based on user feedback and behavioral data.
The US presidential election has driven a significant increase in political advertising expenditure.
According to advertising analysis firm MediaRadar CMAG's data, the advertising expenditure for the 2024 presidential election is close to $1.2 billion, with the total political advertising budget for Congress and other elections reaching as high as $12 billion, nearly three times the advertising expenditure of the 2016 election.
Looking back at history, advertising and politics have always been closely linked. In each US presidential election, ad spending has shown a significant upward trend. With the spread and development of digital media, the proportion of digital advertising in political ads has also been increasing year by year. For digital advertising giants like Meta, the growth of political advertising will undoubtedly bring significant commercial benefits.
Second, the expected profit margin continues to rise, and free cash flow remains stable.
The company's capital expenditure is expected to continue to grow, mainly due to AI infrastructure construction and ongoing investment in Reality Labs. Looking at the input-output situation of technology giants in the AI field, Meta has a relatively clear direction in AI business landing with a relatively high ROI. As for Reality Labs, the expected losses will continue to expand. The company recently launched the latest VR headset product, Quest 3S, priced at only $299, which is cost-effective compared to Apple's Vision Pro, helping to increase market share. However, in the short term, Reality Labs still struggles to be profitable.
Chart: Capital expenditure situation of the company in Q2 2024 (in millions of dollars)
Author: Chancy Chen, Licensed Analyst Meta is about to release its third-quarter financial report after the market closes on October 30th, Eastern Time, with extremely high market attention. According to Bloomberg's unanimous expectations, the company's 24Q3 revenue is expected to increase by 17.83% to $40.235 billion, and diluted EPS is expected to increase by 19.22% to $5.23 year-on-year. Meta's stock performance this year has been very outstanding, with a price increase of over 60% since the beginning of the year. It is expected that Meta's performance this quarter will still be excellent. How should we plan our investment strategy? 1. Advertising business is expected to be strong, supporting the company's performance to exceed expectations Advertising revenue is META's main source of income. It is expected that the company's advertising revenue growth rate for this quarter will still be able to maintain a high growth of around 20%, with the advertising revenue growth rate of the previous quarter at about 21%. The reasons are as follows: 1. The strong support of the US economy continues to drive the growth of advertising revenue. Based on the macroeconomic data of the United States in the third quarter, the retail rates in July, August, and September all achieved month-on-month growth, with a 0.4% increase in retail rates in September compared to the previous month, higher than market expectations. This indicates strong consumer spending in the United States, with virtually no substantial signs of downward trends in the economy. Supported by a robust US economy, advertising prices are expected to continue to rise, and it is anticipated that the advertising revenue for 24Q3 will still perform very well. Chart: US retail rates as of September 2024 (%) Source: U.S. Census Bureau...
Source of information: company announcement.
From the perspective of operating costs, this quarter, the company's operating expenses are expected to be basically flat compared to the previous quarter. Due to the low base of operating expenses in 23Q3, the year-on-year growth rate of operating expenses in 24Q4 is expected to increase. However, considering that the revenue growth of the company is still expected to exceed the growth in expenses,Therefore, there is still room for further improvement in the company's profit margin.
In terms of free cash flow, the company's free cash flow is expected to be roughly the same as the previous quarter, with the growth in capital expenditure partially offsetting the growth in net income. Looking at the whole year, the company's free cash flow in 24 is expected to increase slightly compared to 23 (43.847 billion US dollars).
Chart: Free Cash Flow Situation of the company from 22Q2 to 24Q2 (million US dollars)
Author: Chancy Chen, Licensed Analyst Meta is about to release its third-quarter financial report after the market closes on October 30th, Eastern Time, with extremely high market attention. According to Bloomberg's unanimous expectations, the company's 24Q3 revenue is expected to increase by 17.83% to $40.235 billion, and diluted EPS is expected to increase by 19.22% to $5.23 year-on-year. Meta's stock performance this year has been very outstanding, with a price increase of over 60% since the beginning of the year. It is expected that Meta's performance this quarter will still be excellent. How should we plan our investment strategy? 1. Advertising business is expected to be strong, supporting the company's performance to exceed expectations Advertising revenue is META's main source of income. It is expected that the company's advertising revenue growth rate for this quarter will still be able to maintain a high growth of around 20%, with the advertising revenue growth rate of the previous quarter at about 21%. The reasons are as follows: 1. The strong support of the US economy continues to drive the growth of advertising revenue. Based on the macroeconomic data of the United States in the third quarter, the retail rates in July, August, and September all achieved month-on-month growth, with a 0.4% increase in retail rates in September compared to the previous month, higher than market expectations. This indicates strong consumer spending in the United States, with virtually no substantial signs of downward trends in the economy. Supported by a robust US economy, advertising prices are expected to continue to rise, and it is anticipated that the advertising revenue for 24Q3 will still perform very well. Chart: US retail rates as of September 2024 (%) Source: U.S. Census Bureau...
Source of information: company announcement.
Stable cash flow supports shareholder returns of the company. There is still about $60.06 billion left for repurchase, with an estimated repurchase of around $40 billion each in 24 and 25, and an annual dividend expenditure of about $5.08 billion. The current market cap of the company is $1.44 trillion.The annualized shareholder return rate is approximately 3.1%.。
III. Investment Strategy
The company expects third-quarter revenue to be between 38.5 billion and 41 billion US dollars, with Bloomberg consensus currently at 40.235 billion US dollars, at the top end of the guidance.
The current US economy remains very strong, with online advertising market share continuing to grow. The company's advertising business is expected to continue benefiting. At the same time, Meta has a huge social ecosystem advantage, with powerful AI capabilities continuously optimizing the product strength of advertising tools. Against the backdrop of a significant increase in political advertising spending in the 2024 US presidential election, Meta's advertising revenue growth is expected to exceed both the company's and the market's expectations. In terms of EPS, the expected improvement in profit margin is expected to bring growth of over 20%.
In terms of shareholder returns, the company continues to repurchase and pay dividends. The current market cap of the company is 1.44 trillion US dollars, with an annualized shareholder return rate of approximately 3.1%. The company values shareholder returns, and after a significant increase in free cash flow in 2026, it is expected to increase the scale of repurchases and dividends.
In terms of valuation, the company's current stock price is 567.78 US dollars, with a PE ratio (TTM) of 29.04x. The estimated PE (forward) for 2024 is around 26x, indicating a relatively reasonable valuation.
In summary, the company's performance is expected to exceed expectations, with EPS achieving growth of over 20%, and the company focuses on shareholder returns. The valuation is relatively reasonable, making it still a good investment symbol. It is recommended for investors to buy on dips, while existing investors can continue to hold.
$Meta Platforms (META.US)$
Risk Disclaimer: The above content only represents the author's view. It does not represent any position or investment advice of Futu. Futu makes no representation or warranty.Read more
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