Meta’s shares closed on Friday with a surge of more than 20%, following the company’s announcement of tripling profits in the fourth quarter and releasing its first earnings report.

In the fourth quarter, Meta’s revenue increased by 25%, reaching $40.1 billion, compared to $32.2 billion a year ago. This marks the fastest growth rate in any period since mid-2021, providing evidence of a continuous surge in the online advertising market. Meta’s net income has more than tripled, rising from $4.65 billion a year ago to $14 billion.

The company estimates that sales for the first quarter will be between $34.5 billion and $37 billion. Analysts had anticipated revenue of $33.8 billion.

Meta announced its first-ever quarterly dividend, stating that on March 26, they would pay investors 50 cents per share. This happened as their cash and equivalents increased to $65.4 billion by the end of 2023, up from $40.7 billion a year earlier. Meta also announced a $50 billion share buyback.

On Friday, the stock rally added over $200 billion to Meta’s market cap, pushing its total valuation to over $1.2 trillion.

Investors praised the announcement of profit as a sign of the company’s maturity.

Quilter Cheviot’s technology analyst Ben Barringer stated that it represents a “symbolic moment” and indicates how Meta’s narrative has evolved since its challenges in 2022.

Mark Zuckerberg is indicating a desire to bring shareholders on board, shedding light on Meta’s transformation into a mature, developed business, as mentioned by Barringer in email comments.

Investors are also focusing on Meta’s strides in artificial intelligence with their Large Language Model (LLLM) and partnership with Microsoft-supported OpenAI, competing in the field of AI.

Beringer referred to Meta as the “Closet AI Winner” and mentioned that the company’s AI, though not currently in the show, will “deliver better services to advertisers and make ads more relevant for users.”

Meta CEO Mark Zuckerberg emphasized the creation of a “Year of Competence” for the company in 2023.

Some investors have raised concerns about Meta’s substantial investments, resulting in the company experiencing a quarterly loss of billions of dollars. In the fourth quarter, Meta’s Reality Labs unit exceeded $1 billion in sales, but the Virtual Reality unit recorded a loss of $4.65 billion.

The recent cost-cutting measures at Meta, reflecting a deep response to changes in the economic environment, include layoffs affecting over 20,000 jobs in the past year or around that timeframe, along with Apple’s iOS updates and increasing interest rates

It appears that those steps have borne fruit. Meta has reported doubling its operating margin to 41%, and the company’s expenses have decreased year over year by 8%, reaching 23.73 billion dollars.