Facebook owner Meta sees first ever sales fall

Meta_ the owner of Facebook and Instagram was hit by a fall in advertising sales in the three months to July which caused the first year-on-year (y-o-y) revenue decline in the firm's history.

Meta's total revenue slipped 1 per cent to $28.8 billion_ but the company fended off a decline in users.

Analysts fear the company's growth may have peaked after years of large gains. Rivals like as TikTok have eroded its popularity_ while more firms are competing for ad spending.

Meta_ which typically commands more than 20 per cent of the global ad market_ warned investors that ad sales were likely to fall again in the months ahead_ as e-commerce spending falls from its Covid-19 pandemic boom and companies worried about inflation and the Ukraine war spend more cautiously.

Meta boss Mark Zuckerberg said the firm would reduce its hiring "steadily" over 2023_ a response to the downturn and the company's plans to shift investment into new areas_ including its virtual reality platform_ Horizon_ in a bet that the so-called metaverse is its best prospect for growth.

Earlier 2022_ social media giant Facebook reported its first ever decline in daily users. In response_ the company recently shifted its algorithms on Instagram and Facebook to act more like TikTok_ recommending posts to users from outside the base of accounts they follow_ though the moves have drawn outcry from many users. But the changes may be helping.

In June_ the company said 1.97 billion people logged into Facebook on average each day_ up from 1.96 billion in March; and 2.88 billion into one of its apps daily_ up from 2.87 billion in March.

Zuckerberg said he was pleased by signs that people were spending more time on the firm's apps_ but profits in the quarter still dropped 36 per cent to $6.7 billion.