Facebook Chairman and CEO Mark Zuckerberg testified at a meeting of the Financial Services Committee in Washington on October 23, 2019.

Erin Scott Reuters

Until the first quarter of this year, Facebook’s revenue growth never dropped to single digits. In the second quarter, it may not grow.

Despite the fact that on Wednesday the shares of the parent company Facebook Meta jumped by about 20% in expanded profits, better than expected, the company’s business was declining and does not seem to recover until at least the second half of the year.

In its earnings report for the first quarter, Meta gave revenue recommendations for the current period of $ 28 billion to $ 30 billion, lagging behind analysts’ average estimates of $ 30.6 billion, according to Refinitiv. In the middle of this range, revenue will decline from the second quarter of 2021, when sales were $ 29.1 billion.

The meager forecast stems from annual growth of just 7% in the first quarter, the slowest pace of expansion in Facebook’s 10-year history as an open company. A year ago at this time Facebook grew by about 50% from the big post-pandemic boom when the economy recovered.

On Wednesday, Meta CEO Mark Zuckerberg attributed the slowdown to both internal and macro factors.

Specifically for Facebook, Zuckerberg said the emphasis is on short-term videos, which is a “revenue drag” because they don’t monetize as well as traditional advertising services. More broadly, the company is dealing with changes in Apple’s iOS privacy and “softness in e-commerce after the acceleration we observed during the pandemic”.

Like Snap and Google, Facebook has also suffered from Russia’s invasion of Ukraine.

“We have been blocked in Russia, and we have decided to stop accepting advertising from Russian advertisers around the world,” Zuckerberg said. “And we’ve also seen the consequences for businesses around the world since the war began.”

Investors seem to be disappointed. As of Wednesday’s close, the stock has lost nearly half of its value this year, caused by a big miss forecast in its February earnings report.

But Facebook brought good news in the report: both the number of active users per day and the average revenue per user exceeded estimates.

As for the return to growth, analysts predict that the second half of the year will see expansion back in adolescents.

WATCH: Growing Facebook users is good, but management is a concern

Previous articleSpotify revenue (SPOT) for the 1st quarter of 2022
Next articleRevenue Twitter (TWTR) in the first quarter of 2022