Meta Platforms Inc on Wednesday forecast first-quarter revenue above Wall Street estimates, signalling a rebound in demand for digital ads after months of weak sales.

The parent of Instagram and Facebook forecast revenue between $26 billion and $28.5 billion, compared with analysts’ average estimates of $27.14 billion, according to IBES data from Refinitiv.

Meta shares, which lost almost two-thirds of their value in 2022, were up about 10 percent in extended trading.

The digital ad giant faced a brutal 2022 as companies cut back on marketing spend due to economic worries, while rivals like TikTok captured younger users and Apple’s privacy updates continued to challenge the business of placing targeted ads.

Meta’s forecast is an indication that the ad market may be recovering as companies increase their marketing budgets, after a long pause due to macroeconomic uncertainties.

Net income for the fourth quarter ended Dec 31, however, fell to $4.65 billion, or $1.76 per share, in the quarter ended Dec. 31, compared with $10.29 billion, or $3.67 per share, a year earlier, largely due to a $4.2 billion charge related to cost-cutting moves such as layoffs.

By Nivedita Balu; Editing by Anil D’Silva

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