Company Spotlight: Meta

Overview

Meta is a social technology company that enables people to connect, find communities, and grow businesses. It was previously known as Facebook and was founded by Mark Zuckerberg in Menlo Park, California in 2004.

Meta is one of the world’s most valuable companies and among the ten largest publicly traded corporations in the United States. It is considered one of the Big Five American information technology companies, alongside Google’s parent company Alphabet, Amazon, Apple, and Microsoft.

Facebook

Meta is predominantly recognized for its flagship service, Facebook, which initially found its footing as a social media application catering to college students. However, it has since evolved into an expansive platform facilitating photo sharing and fostering social interactions. At present, Facebook stands as the preeminent social media app worldwide, boasting an impressive 5 billion downloads since its inception. Functioning as a complimentary application, Meta generates revenue through targeted advertisements displayed to its user base. This business model attracts a diverse array of clients, ranging from major corporations to small enterprises, all seeking to invest in marketing tailored to Meta's extensive user community.

As of 2023, Facebook's growth rate has experienced a slowdown in comparison to previous years, primarily due to the saturation of the app's adoption among internet users. This particular challenge has prompted Meta to embark on an exploration of novel business paradigms, ensuring the sustained expansion of their monumental platform.

Rebranding

Facebook has rebranded itself as Meta to signal that the company is branching out and is linked to more than one product. The rebrand is about solidifying the social media giant as being about the metaverse, which Zuckerberg sees as the future of the internet. Zuckerberg has been pouring billions of dollars into building the metaverse, an expansive, immersive vision of the internet taken from the pages of sci-fi novels like Snow Crash and Ready Player One. The rebranding came as a surprise to regular consumers of the app, but Mark Zuckerberg, the founder of Facebook, claimed that Meta was a better representation of what the company is working toward.

Metaverse

Meta’s vision is to build a new version of the internet called the metaverse. The metaverse is where the physical and digital worlds come together. It is a space where digital representations of people – avatars – interact at work and play, meeting in their office, going to concerts and even trying on clothes. At the centre of this universe will be virtual reality, a digital world that you can already enter via Facebook’s Oculus VR headsets. It will also include augmented reality, a sort of step back from VR where elements of the digital world are layered on top of reality – think Pokémon Go or Facebook’s recent smart glasses tie-up with Ray-Ban. Facebook already has a professional version of the metaverse under way: Horizon Workrooms, an app that lets Oculus-sporting workers enter virtual offices and hold meetings. Zuckerberg allocated substantial capital to advance this vision, explaining for Meta's decreased profit margins in 2022 and 2023 compared to earlier years. The company's focus is currently directed towards prioritizing investment over immediate profitability.

Meta's Future

In Q2 2023, Meta reported financial results for the quarter ended June 30, 2023. The company had a good quarter and continues to see strong engagement across its apps. Meta’s founder and CEO, Mark Zuckerberg, said that the company has the most exciting roadmap he’s seen in a while with Llama 2, Threads, Reels, new AI products in the pipeline, and the launch of Quest 3 this fall. The company expects third quarter 2023 total revenue to be in the range of $32-34.5 billion.

Meta's recent progress demonstrates the company's resilience in adapting to the current landscape while consistently driving innovation. The market eagerly anticipates Meta's ongoing developments and future offerings.