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Meta shareholder takeaways: Cost-cutting, metaverse, user privacy

Meta executives outlined their future plans at the company's annual shareholder meeting. Leadership stressed their commitment to cost-cutting, the plans to further develop the metaverse, its share structure, and even the company's role in society. Yahoo Finance tech reporter Allie Garfinkle breaks down what this could all mean for the future of the stock.

Video transcript

- Yahoo Finance's Allie Garfinkle. Allie.

ALLIE GARFINKLE: Hi, Diane. So if there's one thing to know here, it's that just because Meta's stock has exploded this year, it doesn't mean shareholders don't have questions. In fact, shareholders seem to have a lot of questions, both about where the company has been and where it's going. Now, a lot happens at these shareholder meetings. But if I had to distill it down, I'd sort of put it into three points.

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Number one, Meta is staying lean. As has been talked about a lot, Meta is in it's year of efficiency. And moving forward, there will probably be fewer layoffs. At least that's what Mark Zuckerberg seemed to suggest. I'll believe it when I see it. But moving ahead, there will certainly be less hiring at Meta. And one of the things Zuckerberg also called out was this idea that developing AI-efficient tools will also enhance productivity at Meta.

So that was sort of point number one. Year of efficiency continues. Perhaps less layoffs. Now, moving right ahead, continued investment in the metaverse. In my notes, I wrote down, we're investing in the metaverse, gosh darn it. There's something that I've heard over and over again from Meta executives, and now from Zuckerberg at the shareholder meeting, which is something to the effect of we're hearing this narrative that we're not investing in the metaverse anymore. And that's simply not true.

That said, Meta is being very clear about the fact that the metaverse investments are going to be long term. Incredibly long term is sort of the way they've kind of been suggesting at it. They've also been very clear about the ways in which AI is very inextricably linked in their metaverse plans. Now, I think they're being a little slippery on the AI metaverse connection still. AI is in absolutely everything. And that is true of the metaverse. But I think over time, we'll start to see more and more color on those plans.

Now, the last thing that's I think really worth noting-- and it's worth saying that I think this last point really looms over the other two, which is that Meta's governance, share structure, societal role is really under scrutiny. There are a lot of existential questions that are still haunting Meta. For instance, a lot of concerns about governance. For the first time in a while, I've been hearing about the dual class share structure, which, of course, is the case that a lot of tech companies, is the case at Meta, and gives CEO Mark Zuckerberg more voting power than the average shareholder.

So there are concerns about that. Concerns about his hold on the company is what we were hearing from shareholders. There were also a lot of concerns about, frankly, Meta societal role, the role that safety plays in Meta's practices and business. And the reality is one of the things that kept coming up over and over again was concerns about the safety of children.

And I think it's important to say this is something Meta has been fined for in terms of data privacy and children's data privacy by the EU. We actually only need to look back to a specific children's privacy fine in September 2022 when Meta was fined $400 million for concerns about children's safety. So bottom line here-- what I would say is that the concerns that have dogged Meta are still very much there. They're just not showing up in the share price right now.

- Wow. Thank you, Allie. Always a great report from you. Allie Garfinkle, our thanks to you.