"The strongest financial report in history"? Media: Meta has just learned to reserve funds for the Metaverse.

Meta's fourth-quarter performance exceeded expectations across the board, while unveiling two major strategies: "the first-ever Dividend + large-scale buyback plan." Last Friday, the stock price rose by 20%, and its market capitalization returned to over a trillion dollars, making it arguably Meta's "strongest earnings report ever."

However, media analysis on Monday pointed out that Meta has only learned how to allocate funds to the metaverse "more reasonably."

At the end of 2021, when Zuckerberg first expressed his interest in the "metaverse," Facebook was unceremoniously kicked out of the "trillion-dollar club." As the company took a series of more aggressive measures, including rebranding to Meta and increasing its annual capital expenditure budget by nearly 80%, investors' concerns grew, and Meta's market capitalization lost more than a quarter in a single day.

Zuckerberg realized this and launched the so-called "Year of Efficiency" plan, significantly laying off 22% of employees in 2023. Subsequently, performance showed some improvement, but Zuckerberg did not intend to give up on the metaverse; instead, he continued to increase related expenditures.

In the company's fourth quarter earnings call, Zuckerberg stated:

We've made a lot of progress in advancing the vision of AI and the metaverse. In addition, he pointed out that artificial intelligence and the metaverse are still Meta's next investment priorities.

In addition to the historic first dividend and large-scale buybacks, Meta has raised its capital expenditure forecast upper limit by $2 billion this year to $37 billion.

Capital expenditures are mainly used for the construction of the company's data centers, as well as the demand for servers and other infrastructure driven by artificial intelligence. Previously, Zuckerberg announced that Meta plans to purchase about 350,000 NVIDIA H100 GPUs by the end of the year, and with other GPUs, Meta's total computing power will approach the equivalent of 600,000 H100s.

But this time there is no concern about huge expenses. Evercore ISI analyst Mark Mahaney pointed out that Meta's cost structure has improved, advertising revenue has increased, and it has taken shareholder-friendly measures such as dividends. Roth MKM analyst Rohit Kulkarni stated that dividends will bring in more new shareholders, thereby further driving the stock price rise.

Bernstein analyst Mark Shmulik put it more succinctly, leading investors to a simple conclusion last quarter - trust Zuckerberg.

Media analysis points out that as long as the correct numbers continue to develop in the right direction, this trust is likely to be maintained. In 2022, advertising revenue saw its first decline for the entire year, but it grew by 16% in 2023 and has rebounded over time. In 2023, the operating profit margin of the company's core application department surged by 10 percentage points to 47%, reflecting improved financial performance of products like Reels.

The Reality Labs division, which carries the company's metaverse vision, even saw an unexpected increase in revenue in the fourth quarter, surpassing the $1 billion mark for the first time, mainly due to strong sales of the company's Quest VR headsets. However, this business still incurs high costs, with an operating loss exceeding $16 billion in 2023.