Meta is set to report its second-quarter earnings on Wednesday, with investors closely watching the results of its aggressive, multi-billion-dollar push into artificial intelligence.
This strategic focus on AI has been underscored by a series of high-profile hires. The company recently appointed former OpenAI researcher Shengjia Zhao, who contributed to the development of ChatGPT, as the founder and chief scientist of its new Superintelligence Lab. In addition, Meta has brought on key industry leaders, including Scale AI CEO Alexandr Wang, former GitHub CEO Nat Friedman, and Safe Superintelligence CEO Daniel Gross. The company also poached Apple’s head of AI foundation models, Ruoming Pang.
The talent acquisition is matched by massive capital investment in infrastructure. CEO Mark Zuckerberg revealed plans to invest hundreds of billions of dollars in building several multi-gigawatt AI data centers across the United States. One facility, named Hyperion, is designed to eventually scale up to 5 gigawatts of capacity. This follows a reported $14.3 billion investment in Scale AI.
Ahead of the report, analysts project earnings per share of $5.89 on revenue of $44.83 billion, according to Bloomberg consensus estimates. This would represent a significant increase from the $5.16 EPS and $39.07 billion in revenue reported in the same period last year. Advertising revenue is expected to climb 15% year-over-year to $44.09 billion, while the Reality Labs division is forecast to bring in $386 million.
While the spending is substantial, Meta is already reporting early returns on its AI initiatives. “AI has already made us better at targeting and finding the audiences that will be interested in their product,” Zuckerberg noted during the first-quarter earnings call. He highlighted a new Reels ad recommendation model that has increased conversion rates by 5% and a 30% quarterly increase in advertisers using the company’s AI creative tools.
This strategy has earned praise from Wall Street, with BofA Global Research analyst Justin Post identifying Meta as “one of the best AI opportunity stocks” due to its audience scale and potential for integrating AI into its advertising stack.
Beyond advertising, Meta is extending its AI ambitions into consumer hardware with its Ray-Ban and newly unveiled Oakley Meta smart glasses, with plans for standalone AI glasses in the future. These products are part of Zuckerberg’s broader vision for “personal superintelligence.”
“An even more meaningful impact on our lives will likely come from everyone having a personal superintelligence that helps you achieve your goals,” Zuckerberg stated, distinguishing his approach from what he described as more centralized AI models where “humanity will live on a dole of its output.”
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