Meta reports 21% increase in advertising revenue for fourth quarter 2024

In a financial report released on January 29, 2025, Meta demonstrated significant growth in its advertising business during the fourth quarter of 2024, with advertising revenue reaching $46.8 billion, marking a 21% increase compared to the same period in 2023.

The company's advertising performance was driven by two key metrics. According to Meta's earnings report, ad impressions across its family of apps, which includes Facebook, Instagram, Messenger, and WhatsApp, increased by 6% year-over-year. The average price per ad also showed substantial growth, rising by 14% compared to the fourth quarter of 2023.

The strong advertising performance contributed to Meta's total revenue of $48.4 billion for the quarter, representing a 21% increase from the previous year. The company's operating margin expanded to 48%, up from 41% in the same quarter of 2023.

Meta's advertising success was supported by its growing user base. Daily active people across Meta's family of apps reached 3.35 billion in December 2024, showing a 5% increase year-over-year. This metric represents the combined daily active users of Facebook, Instagram, Messenger, and WhatsApp.

Looking at the full year 2024, Meta's advertising revenue totaled $160.6 billion, a 22% increase from 2023. The company delivered 11% more ad impressions across its platforms throughout the year, while the average price per ad increased by 10%.

The financial results revealed that advertising continues to dominate Meta's revenue structure. In the fourth quarter, advertising accounted for 96.7% of the company's total revenue, with only $1.1 billion coming from Reality Labs and $519 million from other revenue sources.

Meta's Family of Apps segment, which handles the company's advertising business, generated $28.3 billion in operating income during the fourth quarter, a significant increase from $21 billion in the same period of 2023. However, the Reality Labs segment, focused on virtual and augmented reality technologies, reported an operating loss of $5 billion.

The company's advertising infrastructure received continued investment, with capital expenditures reaching $14.8 billion in the fourth quarter. According to Meta's financial statement, these investments supported both the core advertising business and new technological initiatives.

Meta's Chief Financial Officer provided guidance for the first quarter of 2025, projecting total revenue between $39.5 billion and $41.8 billion. This forecast includes consideration for foreign currency impact, which is expected to create an approximately 3% headwind to year-over-year growth based on current exchange rates.

The company's financial statements also revealed significant spending on research and development, which totaled $12.2 billion in the fourth quarter of 2024, an increase from $10.5 billion in the same period of 2023. This investment supports various initiatives, including advertising technology improvements and artificial intelligence development.

Meta maintained substantial cash reserves while managing its advertising business, with $77.8 billion in cash, cash equivalents, and marketable securities as of December 31, 2024. The company generated free cash flow of $13.2 billion during the fourth quarter.

The financial results demonstrated Meta's continued focus on optimizing its advertising operations while investing in future technologies. The company's operating margin improvement suggests successful management of costs despite ongoing investments in infrastructure and technology development.