After a less-than-stellar performance in Q4 of 2021, Facebook has managed to get its user growth back on track. This change in performance is easing some of the concerns marketers had about the platform.
1. Facebook Usage
First, let’s take a look at overall daily activity. We can see that Facebook’s activity averaged out at around 1.96 billion for March of 2022. That is a 4% increase compared to last year. The majority of their growth came from Asia, but let’s take a look at what’s happening in Europe and the US.
Facebook’s daily usage rates declined by 2 million in Europe, and only saw a slight increase in the US, but when you look at the bigger picture, that isn’t necessarily a bad thing. In the case of Europe, a large amount of the drop in traffic can be attributed to the war in Ukraine. But even without that, usage has fluctuated in both markets for some time, and it may well be that Facebook has reached its optimal usage in both regions.
But what about monthly activity? Things are looking just ask good for them with Facebook rising to 2.94 billion, which is an increase of 3% year-over-year.
The decline in European usage is much more pronounced here, around 9 million, which could point to declining popularity of the app in some markets.
Though, that sharp decline also likely relates to the fact that Facebook reportedly had over 70 million users in Russia as of February 2022, before Russia’s communications regulator moved to block Facebook access entirely in March.
2. Facebook Revenue
Daily users is a good stat to look at, but marketers and shareholders care more about revenue. In Q1 of 2022, Meta brought in $27 billion, which is up 7% year-over-year.
While that increase sounds good on paper, looking at the graph we can see that there was a sharp decline in revenue in its biggest two ad markets, though Meta does note that ad impressions delivered increased by 15% year over year.
Meta’s still grappling with Apple’s iOS 14 update, which has limited its data collection capacity, which it’s previously noted would drag its results down by around $10 billion in 2022 alone. Meta also says that the drop in revenue in the back half of the first quarter was exacerbated by the war in Ukraine, while at the same time, it continues to invest in emerging technologies, driving increased spend.
And that reason is why Meta is not too worried about the slowing of revenue. They care about the Metaverse right now and setting the foundation for the next stage. But Meta has one thing not working for them, patience is required. If there is one thing shareholders and the public are not great with, it’s patience.