A year ago, Mark Zuckerberg declared virtual reality the next frontier to drive Facebook’s growth. But so far, there has been very little of it.

The company’s share price has plunged, revenues are falling and profits are on the decline.

The picture worsened on Wednesday, after the company, now named Meta, updated investors on three months ended in September.

Sales shrank 4% compared to a year ago to $27.7bn, while profits halved.

The company, which also owns Instagram and WhatsApp, is struggling as companies cut advertising budgets in the face of economic uncertainty, changes to Apple’s privacy settings undercuts its targeted ads, and competition from rivals such as TikTok heats up.

Mr Zuckerberg, who founded Facebook at university almost two decades ago, acknowledged the firm faced “near-term challenges”.

He said the company was focused on becoming more efficient and hinted at job cuts, saying the firm may be a “smaller organisation” next year.

“There are a lot of things going on right now in the business and in the world,” he said. “We’re going to resolve each of these things… I think those who are patient and invest with us will end up being rewarded.”