Navigating Meta’s Quarterly Earnings Reports

Quarterly earning reports from Meta can stir interest among advertisers and data watchers. This is particularly true when there are significant shifts in certain key usage metrics. Advertisers might be interested in key platform usage data, but information may not always be easy to find within the formats of Meta’s presentation slides and press releases.

To help provide a window into the most interesting platform usage data, we’ve built the Meta Quarterly Earnings Data Segmenter: a tool that frames the view of key metrics from Meta’s quarterly earnings reports. Our tool has been developed with advertisers in mind. It enables filtering data across time periods and by specific geography (where Meta has made such information applicable).

How This Tool Is Built

We’re hopeful that this tool makes accessing data from Meta’s quarterly earnings reports as easy as possible.

Please note: *Meta does not own or sponsor this dashboard*. The data we’ve synthesized in our tool is all extracted information from Meta’s public slides and press releases on Meta’s investor website. Specifically, data provided from their Financials reporting can be used to identify key data with implications for advertisers. Now, to our tool.

Included Metrics

When Meta publishes their quarterly data, they usually provide it in the form of slides which cover only a two year retrospective. This makes it difficult to quickly cross-reference historical data, beyond the two year period that Meta states. Our tool compiles multiple data releases across time into a single dataset, wherever possible.

The data in our Meta Quarterly Earnings Data Segmenter tool can be filtered, navigated, and downloaded. We made every effort to accurately extract information, but only Meta’s self-published reporting should be treated as official.

We did not extract all available information from all Meta slides. Instead, we have focused on the metrics most relevant for advertisers:

  • Ad Revenue: Overall Meta revenue, as well as revenue broken out by region
  • Meta Family Active People: Including Daily and Monthly Active People metrics
  • Facebook Active Users: Including Daily and Monthly Active User metrics
  • Average Revenue per User: Reflecting revenue across all Meta properties
  • Average Revenue per Person: Reflecting revenue across Facebook and Facebook Messenger, including a breakout by region
  • Meta Apps Revenue by Source: Reflecting how Meta’s different properties are generating income
  • Meta Apps Operating Income by Source: Reflecting profitability of Meta’s income sources
  • Ad Prices and Impressions: Shows how much ad costs and delivery are changing over time
  • Meta Employee Headcount: Reflecting how Meta is hiring

Depending on interest, we may keep this database updated in the future.

Accessing Our Meta Quarterly Earnings Data Segmenting Tool

Throughout this article, we have embedded different pages of the segmenting tool. The tool is fully interactive, built using Google Data Studio. If you find you have difficulty interacting with the reports, you might try using the tool from a desktop computer.

If you’d like to go directly into the tool, Click here to access the dashboard in full-screen.

Meta Family of Platforms – Active People

These are the users who access any Meta platforms within a defined scope.

According to Meta:

Meta defines a daily active person (DAP) as a registered and logged-in user of Facebook, Instagram, Messenger, and/or WhatsApp (collectively, their ‘Family’ of products) who visited at least one of these Family products through a mobile device application or using a web or mobile browser on a given day.

Here, we can gather a sense of the overall “Active People” activity across Meta’s mix of platforms. Unfortunately, these datasets do not allow us to segment these active users by different Meta platforms. However, there is specific info for Facebook users, which we’ll cover next…

Facebook Specific Platform – Active Users

According to Meta:

Meta defines a Facebook daily active user as a registered and logged-in Facebook user who visited Facebook through the Facebook website or a mobile device, or used Facebook’s Messenger application (and is also a registered Facebook user), on a given day.

This is a key metric of changes in user behavior, so it seems logical that investors might pay particular attention to this data point as a core indicator of Meta’s growth.

Ad Revenue

Ad Revenue is a general indicator for the overall spend that is occurring across Meta’s properties.

How does overall revenue affect advertisers? Key questions to consider:

  • As cash inflow increases, is Meta able to keep up the pace via hiring and/or automation?
  • Are certain regions potentially over or under-invested vs. the advertising opportunity?

Average Revenue per User – Meta and Facebook

One of the more valuable metrics for advertisers may be the Average Revenue per User reporting. In particular, this metric may be most closely connected to the ad auction.

Meta uses an ad auction to determine which ad(s) to show to a person at a given point in time. The “winner” of the auction is the ad (and the advertiser) which Meta deems most valuable, based on an algorithmic competition among cost bidding, estimated ad action rates (by the user), and ad quality. Generally speaking, as revenue per user increases, competition in the ad auction also increases.

That said, advertisers should remember that an overall increase in ad competition does not necessarily increase advertisers’ costs. The ad auction takes into account other factors far beyond just advertiser bid. Jon has written all about the auction here. He’s also written about how competition among ads can impact results here.

Revenue by Source

Meta recently changed the way they break out revenue, in two new categories: Family of Apps and Reality Labs.

Family of Apps includes “Facebook, Instagram, Messenger, WhatsApp, and other services”, while Reality Labs includes “augmented and virtual reality related consumer hardware, software, and content.”

Understanding the breakout of revenue across these two categories can be a useful point of reference as advertisers explore how Meta prioritizes the VR of Reality Labs against the familiar messaging and social platforms of their Family of Apps, in particular.

Operating Income by Source

Operating Income is categorized in the same way as revenue: by Family of Apps and Reality Labs. Note that Operating Income can be a particularly useful point of reference as it subtracts operating expenses from revenues. Essentially, we can identify what is profitable within Meta’s income mix.

This data point sheds light on which category is not currently generating revenue for Meta, which can be a potential indicator of the degree that Meta prioritizes a particular segment (e.g. Reality Labs’ augmented/virtual) as a long-term investment rather than a short-term revenue stream.

In other words, lines of business that are not revenue (and profit) drivers, might be seen as investments for future profitability to the company. So, tracking these costly investments over time can show us what’s most important to Meta, and that can help advertisers understand when such divisions (cost-heavy investments) transform into profit drivers for Meta.

Ad Impressions Delivered and Average Price Per Ad

Meta has very recently started to include two new key metrics which were not included in older quarterly earnings reports: Ad Impressions Delivered, and Average Price per Ad. Both of these data points are reported as a percentage change year-over-year, for the quarter reported.

Average Price per Ad is likely the most important to advertisers, as this can potentially be used as a proxy for overall auction costs.

Workforce Growth: Tracking Meta’s Employee Headcount

As Meta’s revenue increases, advertisers likely wonder how Meta is adding resources and expertise to match growing usage. Starting in Q1 of 2017, Meta has regularly included employee “headcount” numbers in their quarterly earnings press releases. This data provides a useful point of reference for understanding one way that the company keeps pace with their growth.

Of course, Meta is likely placing significant efforts on automating processes (such as ad approvals), so employee headcount alone should not be considered a direct indicator of how effectively Meta is supporting advertisers. Additionally, not all of Meta’s employees are focused on advertising. However, we can complete our own calculations to discern how headcount may maintain pace with ad revenue by introducing a new metric: ad revenue per employee.

Your Turn

Do you find this tool useful for navigating Meta’s quarterly earnings reports? If so, please let us know! If there is interest, we will look at keeping this updated each time Meta releases their reports.