Analysts estimate that META will grow revenues in 2023 over 2022. However, the estimates I see imply that revenue growth will be back-end loaded. We know how that usually ends. I see META struggling to generate year-over-year Revenue growth and expect for 2023 to be a down Revenue year. Zuckerberg is not an Operator. META’s social platforms are old and tired.
Regarding META I see:
- Continued pricing pressure from Ad buyers. Ad pricing pressure primarily as a result of Apple’s iOS change last year which limits META’s ability to collect targeted Ad data from iOS. YouTube and TikTok will take Ad spend share not to mention Amazon (AMZN) and Microsoft (MSFT). In fact, Microsoft is the real metaverse leader with its Xbox platform.
- Macro headwinds. I see macro-economic headwinds for all of 2023 that will hamper META’s ability to generate Ad revenue.
- Old and tired. Both Facebook and Instagram are old and tired platforms (especially the former), that will continue to lose share to TikTok and YouTube, especially YouTube (GOOGL). Instagram is increasingly cumbersome to use.
- Zuckerberg is not an operator. It would seem the course of action for META would be to tighten the Ope Ex belt, reduce the pace of spend on the metaverse, freshen-up Instagram and turn Facebook into a platform tailored for small business users. The 2022 Kustomer acquisition was a good start. Acquiring Intuit (INTU) would make sense.