Facebook and Instagram’s parent company Meta posted its first revenue decline in history, dragged by a drop in ad spending as the economy falters — and as competition from rival TikTok intensifies.

Shares of Meta fell by 3.3 per cent to $US163.84 in after-hours trading.

The results also largely followed a broader decline in the digital advertising market that is dinging rivals such as Alphabet and Snap. Google’s parent company reported its slowest quarterly growth in two years on Tuesday.

Meta also faces some unique challenges, including the looming departure of its chief operating officer Sheryl Sandberg, the chief architect of the company’s massive advertising business.

In addition to TikTok, the decline in ad spending among the downturn and Apple’s privacy changes, “questions about Meta’s leadership” — including Sandberg’s exit and negative sentiment about the company as a whole — also contributed to the decline, said Raj Shah, a managing partner at digital consultancy Publicis Sapient.

Meta earned profits of $US6.69 billion ($9.6 billion), or $US2.46 per share, in the April-June period. That’s down 36 per cent from $US10.39 billion, or $US3.61 per share, in the same period a year ago.

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Revenue was $US28.82 billion, down 1 per cent from $US29.08 billion a year earlier.

Analysts, on average, were expecting earnings of $US2.54 per share on revenue of $US28.91 billion, according to a poll by FactSet.