Meta Says it Lost 20 Million Users at the Beginning of the Year
During a Q1 earnings call on Wednesday, Meta revealed it lost 20 million users across its family of apps.
The company, which still recorded 3.5 billion daily visitors, didn’t specify whether the users are bleeding from Facebook, Instagram, or WhatsApp; instead, Meta’s chief financial officer, Susan Li, blamed “internet disruptions in Iran, as well as a restriction on access to WhatsApp in Russia.”
According to Fortune, Meta’s stock fell 9 percent yesterday, despite announcing a net income of $26.8 billion and revenue of $56.3 billion. That is a 33 percent increase year-on-year.
But it’s not the 20 million lost users that’s alarming investors — The Verge speculates that it might be Facebook that’s hemorrhaging daily visitors — it’s the eye-watering sums the company is ploughing into artificial intelligence.
Meta is now expecting to spend somewhere between £125 billion and £145 billion on AI architecture. That’s a $10 billion increase.
According to Fortune, Li said that “we have continued to underestimate our compute needs even as we have been ramping capacity significantly, as the advances in AI have continued and our teams continue to identify compelling new projects and initiatives.”
Last week, Meta informed staff it is planning to cull 10 percent of its workforce this month — about 8,000 jobs. This cost-saving exercise is so that Meta can spend more money on AI infrastructure.
One analyst, Matt Britzman of Hargreaves Lansdown, tells Fortune that there are more and more investors who are beginning to question AI.
“The market was less united on what to make of the spending plans, with investors still trying to balance the scale of the AI opportunity against the cash required to chase it,” he says.
Meanwhile, Meta is getting hammered with fines by authorities from all over the world: last week, European Union (EU) regulators charged Meta for failing to prevent children under 13 from accessing Instagram and Facebook.
In March, Meta was ordered to pay $375 million after a jury in New Mexico found it liable for failing to protect children from exploitation and harmful content on its platforms. In the same month, a Los Angeles jury found that Meta and Google were liable for harm caused to a young woman who said she became addicted to their platforms as a child, awarding her $6 million in damages in the landmark case.
Image credits: Header photo licensed via Depositphotos.
