the times | Thursday February 3 2022 2GM 35
Business
Callum Jones
US Business Correspondent
Shares in Meta Platforms, the owner of
Facebook, fell sharply last night after
the company warned of an advertising
slowdown in the real world as it invests
heavily in the virtual.
The technology group revealed an
unexpectedly steep decline in quarterly
earnings and cautioned that users are
spending less time in the most profita-
ble corners of its social networks.
Meta is also braced for advertisers to
rein in spending amid soaring inflation
and supply issues. The impact of Ap-
ple’s privacy changes looms large, too.
Meta’s shares dropped 22 per cent, or
$71.10, to $251.90 during late trading on
Wall Street last night. Snap fell 17.2 per
cent, or $5.52, to $26.55, while Twitter
declined 8.6 per cent, or $3.12, to $33.39.
Meta’s warnings come after a torrid
year for Mark Zuckerberg’s empire in
the public sphere, as its platforms were
accused of harming children, stoking
division and threatening democracy.
Total revenue climbed by 20 per cent
to $33.7 billion in the three months to
the end of December. Net income fell 8
per cent over the year, to $10.3 billion
during the quarter.
Facebook changed its corporate
name to Meta in October in an expen-
sive bet on the metaverse — a virtual
realm where users interact without
being physically together. It said invest-
ment in the space would knock its
annual profits by about $10 billion.
The world’s largest social media
group, valued at $900 billion and based
commoditiescommodities currenciescurrencies
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6,500The Bank of England looks set to revise
up its forecasts for inflation for a fourth
consecutive time when it updates its
outlook today.
The central bank’s monetary policy
committee is expected once again to
raise its projections for inflation in its
quarterly monetary policy bulletin —
previously called the Inflation Report —
Bank faces prospect of raising its inflation forecasts yet again
Arthi Nachiappan
Economics Correspondent
in light of unexpectedly high price pres-
sures. It is due to be published after the
Bank’s interest rate meeting today. Fu-
tures markets have bet that the Bank is
certain to lift interest rates by 0.25 per-
centage points to 0.5 per cent, its first
back-to-back rate rise since 2004.
Quarterly inflation figures have
exceeded central bank officials’ predic-
tions for the past three quarters.
The 5.4 per cent rate of inflation
recorded in December, a 30-year high,was 0.8 percentage points above the
rate predicted in November’s report
and exceeded the 0.6 percentage point
shortfall in the previous month.
Ruth Gregory, senior UK economist
at the Capital Economics consultancy,
said that inflation had risen far higher
and far faster than the central bank’s
forecast. “The past month has brought
further evidence that price pressures
are broadening out,” she said, “so the
Bank’s previous forecast for CPI infla-tion to peak at 6 per cent and to average
4.3 per cent this year is almost certain to
be revised up, perhaps bringing it more
in line with our own forecast: a peak of
7 per cent and average of 5.8 per cent.”
The latest inflation figures, for
December, are at almost triple the cen-
tral bank’s target of 2 per cent. Unem-
ployment levels are close to historic
lows at 4.1 per cent, with the number of
vacancies almost equal to the number
of people jobless for the first time sincecomparable data began to be recorded
more than 20 years ago.
However, looming rises in the energy
price cap, minimum wage rates and
national insurance contributions in
April is likely to suppress demand.
Forecasters expect the impact of the
Omicron variant of the coronavirus on
the economy to prove short-lived and
that the recovery will be back on track
by the spring, now that Plan B restric-
tions have been lifted.Facebook owner’s shares slump 22 per cent
Warning of
ad slowdown
rocks Meta
in California, was founded by Zucker-
berg, 37, in 2004, and has over 70,000
staff. It owns Facebook; Instagram, the
video-sharing app; and the messaging
services WhatsApp and Messenger.
The company’s daily active users
grew by 5 per cent over the year to finish
2021 at 1.93 billion, but it spooked share-
holders yesterday by reporting a “shift
of engagement” within its apps towards
less profitable areas, such as its Reels
video feature. Dave Wehner, chief fi-
nancial officer, also cited “increased
competition for people’s time.”
Wehner said it had been “hearing
from advertisers that ... cost inflation
and supply chain disruptions are im-
pacting their budgets”.
Headwinds in the current quarter in-
clude software changes for Apple
devices such as the iPhone last year,
which allowed users to control tracking
of their activity online. The updates
made it more difficult for advertisers
that rely on data to develop new prod-
ucts and understand their market.
Meta projected total revenue of
$27 billion to $29 billion for the three
months to March’s end, short of Wall
Street projections of $30 billion-plus.
Reality Labs, Meta’s augmented and
virtual reality hardware business, post-
ed a 22 per cent rise in revenue to
$877 million in the fourth quarter. Op-
erating losses widened within the divi-
sion, which the company has said will
not be profitable “any time in the near
future”, from $2 billion to $3.3 billion.
Revenue in its apps business rose
20 per cent to $32.8 billion. Operating
profits rose 7 per cent to $15.9 billion.DOMINIC LIPINSKI/PABattery recycling plant charges ahead
Emily GosdenGlencore and Britishvolt, the giga-
factory developer, are to build a plant to
recycle lithium-ion batteries.
Up to 400 jobs could be created
through the facility at Glencore’s Bri-
tannia Refined Metals site in North-
fleet, Kent, which is expected to be in
operation by the middle of next year.
The proposed plant is forecast to pro-
cess 10,000 tonnes a year of lithium-ion
batteries from portable electronics and
electric vehicles and scrap generated in
the production of batteries at British-
volt’s planned gigafactory in Blyth,
Northumberland.
The companies said that they intend-ed to provide “recycled metals and min-
erals back into the battery supply
chain”. It is unclear if the recycling
plant’s output will all necessarily be
used at the Blyth plant, but Britishvolt
said that increased use of recycling
would allow it to offer its carmaker cus-
tomers “hedging opportunities against
swings in raw materials prices”.
Britishvolt’s Blyth plant is Britain’s
largest planned gigafactory and should
produce enough battery cells to power
300,000 zero-emission cars a year.
Glencore, the FTSE 100 commodi-
ties group, invested in Britishvolt last
summer when it struck a partnership
for the long-term supply of cobalt to the
company from Norway and the Demo-cratic Republic of Congo. Britain has no
large-scale battery recycling plants, but
the volume available for recycling is
forecast to grow as the electric vehicle
industry develops. Several other com-
panies have plans for plants.
Timon Orlob, global chief operating
officer at Britishvolt, said it aimed to
“help kick-start a UK battery recycling
industry. Recycling is key to a success-
ful energy transition and has always
been a major part of Britishvolt’s busi-
ness model.”
Last month Britishvolt secured
£100 million of government funding
and up to £2 billion in project finance
from abrdn and Tritax to develop the
Blyth gigafactory and nearby facilities.Royal honour Sir António Horta-Osório, the former Lloyds boss who resigned as chairman of Credit Suisse this month over
breaches of coronavirus quarantine rules, was made a knight bachelor by the Princess Royal at Windsor Castle yesterday