Meta Reports Travel Was Fourth Quarter Bright Spot

25.08.2023 - 14:11 / skift.com / Dennis Schaal / Mark Zuckerberg

Although Meta’s advertising revenue declined in the fourth quarter, travel and healthcare were the largest bright spots, the company reported Wednesday.

“The largest positive contributors to year-over-year growth in Q4 were the travel and health care verticals, though both are relatively smaller verticals in absolute share,” Chief Financial Officer Susan Li told financial analysts during the company’s fourth quarter and full-year 2022 earnings call. 

Advertising revenue for Meta, which operates Facebook, Instagram and WhatsApp, declined 4.2 percent year over year in the fourth quarter to $31.2 billion. The full-year revenue decline was 1.1 percent.

“Consistent with our expectations, Q4 revenue remained under pressure from weak advertising demand which we believe continues to be impacted by the uncertain and volatile macroeconomic landscape,” Li said.

She said the financial services and technology verticals were the largest negative contributors to the company’s fourth quarter revenue drop-off, but they are not major components of the company’s revenue.

In another issue of interest to travel marketers, Meta founder and CEO Mark Zuckerberg said the growth of short-form reels has more than doubled in the Facebook and Instagram apps over the last six months, but the company’s monetization of them has fallen short.

In fact, more visitor engagement with Reels means less focus on the news feed so Meta loses money in the process, he said.

“The next bottleneck that we’re focused on to continue growing Reels is improving monetization efficiency or the revenue that’s generated per minute of Reels watched,” Zuckerberg said. “Currently, the monetization efficiency of reels is much less than Feed [the Facebook news feed]. So the more that Reels grows, even though it adds engagement to the system overall, it takes some time away from Feed, and we actually lose money.”

In other travel-related news, Zuckerberg said Air France began using the WhatsApp Business Platform to distribute boarding passes and to disseminate flight information to flyers in 22 countries and four languages. 

For the fourth quarter, Meta’s net income fell 55 percent year over year to $4.65 billion. Full year net income dropped 41 percent to $23.2 billion compared with 2021.