Meta has just released its second-quarter earnings report and the figures are better than expected. The social media firm’s pivot away from the metaverse and into artificial intelligence (AI) has been the catalyst for growth.
On July 26, the company formerly known as Facebook announced its Q2, 2023 earnings which were better than expected.
Meta group revenues rose 11% from the same period in 2022 to $32 billion. The firm reported profits for the three months ending in June at $7.8 billion. This works out at $2.98 per share, up 21% from the same period last year.
Meta founder and CEO Mark Zuckerberg said “We had a good quarter,” adding:
“We continue to see strong engagement across our apps, and we have the most exciting roadmap I’ve seen in a while with Llama 2, Threads, Reels, new AI products in the pipeline, and the launch of Quest 3 this fall,”
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The Facebook parent unveiled a series of new AI-related tools it plans to roll out across its app ecosystem last month. These include an AI chatbot similar to ChatGPT for Messenger and WhatsApp.
It has also reportedly been working with advertisers in testing consumer-facing generative AI techniques.
It appears the pivot to AI has worked for Meta. The division that houses the company’s metaverse plans, Reality Labs, will continue to see “meaningful” operating losses in the coming year, according to the firm.
Moreover, the firm was grilled over its metaverse ambitions due to privacy concerns and data harvesting from its users. The company does not have a good reputation for privacy on its flagship social media platform.
“In many ways, the two are interrelated,” Zuckerberg said of AI and metaverse on a conference call.
Ad Revenue and Stock Up
Furthermore, Facebook has seen an increase in daily active users which was up 5% to 2.06 billion. Additionally, monthly active users climbed 3% over the quarter to 3.03 billion.
Meta suffered a rough 2022 amid a global economic downturn which forced advertisers to cut back on spending. However, advertising impressions across its suite of apps were up 34% in Q2.
Company stock rose 6.3% on the day to trade at $319 in after-hours trading on July 26. Meta has had a solid year of growth gaining 155% since the beginning of 2023.
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