This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.
What happened
Shares of Meta Platforms (NASDAQ: FB) took a hit on Monday, declining as much as 3.7%. But as of 1:30 p.m. ET, the stock was down 2.1%. The stock's decline worsens a sharp year-to-date decline as investors worry about the social media company's ability to return to strong revenue growth rates.
While this theme could be behind some of the stock's pullback on Monday, it was likely mainly driven by bearishness in the overall market.
So what
Highlighting what a brutal year it's been for the parent company of Facebook, Instagram, and WhatsApp, shares have cratered more than 40% year to date as of this writing. However, the stock is notably up from levels in April, before the company impressed investors with better-than-expected earnings per share.
The stock's move lower on Monday comes as the overall market tumbles with investors worrying about the impact of inflation and rising interest rates on the economy and on an already uncertain operating environment for many companies. Capturing the broader market drawdown on Monday, as of this writing, the S&P 500 is down about 2.6% and the Nasdaq Composite is down 3.5%.
Now what
Meta grew its revenue just 7% year over year in the first quarter as the company faces off against tough year-ago comparisons and continues to deal with Apple's recent changes to ad tracking and measurement on iOS, its mobile operating system.
Looking ahead, management expects continued headwinds. While the company is making progress on addressing challenges presented by iOS, Meta isn't fully out of the woods yet. In addition, the company's year-ago comparison in Q2 is particularly tough. To this end, management guided for second-quarter revenue to come in at $28 billion to $30 billion, compared with $28.6 billion in the year-ago quarter. The low end of this guidance range, therefore, would notably translate to a year-over-year decline.
Of course, Meta hopes that, as it works through its tough year-ago comparisons in the first half of the year and solves challenges associated with iOS, revenue growth can reaccelerate.
This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.
