Meta, the parent company of Facebook and Instagram, has announced a Q1 profit of $5.7bn (£4.6bn), beating expectations despite job cuts, with AI driving good results.
Mark Zuckerberg, the CEO of Meta, announced that the company’s total revenue for the first quarter of the year was $28.6bn, and the monthly active users on Facebook rose to nearly 3 billion.
Mark Zuckerberg said that they are improving their efficiency to develop better products quickly and position themselves well to achieve their long-term goals.
Mr. Zuckerberg told investors that Meta no longer lags behind in building AI and sees the chance to introduce AI agents to billions of people in useful and meaningful ways.
Meta’s CEO, Mark Zuckerberg, announced that the company is exploring chat experiences for WhatsApp and Messenger, as well as visual creation tools for Facebook and Instagram posts and ads. He also mentioned that Meta plans to introduce video and multimodal experiences in the future.
Meta plans to monetize its privately-operated generative AI, following in the footsteps of Google, which is also seeking practical uses for this technology amid a lot of hype surrounding its capabilities in the industry.
Meta founded Facebook’s AI Research lab in 2013, but has not achieved significant progress in this field compared to other major tech companies like Microsoft.
According to Mr. Zuckerberg, Meta has caught up in building its AI infrastructure and will release generative AI products in the coming months. He also clarified that this move will not affect the development of Meta’s virtual reality project, the metaverse.
Meta’s Reality Labs division suffered a net loss of $4bn in the last quarter and predicted an increase in operating losses in 2023. Despite this, CEO Mark Zuckerberg denied rumors that the company was moving away from the metaverse and confirmed plans to unveil the next Quest VR headset later this year.
Mr. Zuckerberg stated that the positive financial results align with Meta’s cost-cutting strategy to make 2023 “a year of efficiency.”
Debra Aho Williamson, principal analyst at Insider Intelligence, said that Meta has been the most aggressive among US big tech firms in downsizing, cutting over 20,000 jobs, which is almost a quarter of its global workforce, in just a few months.
“In this economic environment, achieving a 3% year over year revenue growth is an accomplishment after the disaster that was 2022,” said Insider Intelligence principal analyst, Debra Aho Williamson.
According to Mr. Zuckerberg, 2022 was “a humbling wake-up call,” and he suggested that it would be wise to prepare for the possibility that this new economic reality would persist for several years.
According to Ben Barringer, an investment manager at Quilter Cheviot, “Meta’s transformation in the last six months is impressive, and credit should be given to Mark Zuckerberg.
The company’s focus on efficiency is paying off, and these financial results beat expectations. With the macroeconomic environment improving, Meta is expected to continue to recover.”
Source : bbc.com