(San Francisco) Meta (Facebook, Instagram, WhatsApp) turned trial in the second quarter with better-than-expected revenue and profit, driven by a rebound in advertising, while investing more in artificial intelligence (AI).
The social media giant amassed $32 billion in second-quarter revenue, up 11% year-on-year, from which it posted $7.8 billion in net profit (up 16%), according to its published earnings release. Wednesday.
“This is its first quarter with double-digit revenue growth since the end of 2021,” notes Insider Intelligence analyst Debra Aho Williamson. “If the company continues its momentum in the second half, it will end 2023 in much better shape than it started the year. »
The action of the Californian group, which has just launched Threads, a new Twitter rival application (renamed X), and a latest generation AI program, took nearly 7% during electronic trading after the close of the Stock Exchange. New York on Wednesday.
In its earnings release, the company welcomed the fact that the number of advertisements appearing on its various applications increased by 34% year-on-year in the second quarter.
“There were several positive factors in the second quarter, including the strong performance of ‘Advantage’, the new suite of AI-powered advertising automation tools, and an improved economic backdrop,” comments Debra Aho Williamson.
After a difficult year 2022, Meta has largely recovered in the first half of 2023, in particular thanks to major social plans. The company now has nearly 71,500 employees worldwide, down 14% from a year ago.
“Meta is still facing challenges”, however, tempers the analyst, pointing out that the market share of the world’s number two in digital advertising should drop to 20% this year, in particular because of the progress of TikTok and Amazon .
On July 5, the group launched a new social network centered on written conversations, Threads, downloaded more than 100 million times in a few days, in particular thanks to easy registration directly via Instagram.
Even though users seem less active than when they started, and even without advertising for now, “the launch has been an image boon for Meta and has helped divert attention from its booming metaverse business. slump,” said Debra Aho Williamson.
Reality Labs, the arm responsible for developing augmented and virtual reality devices and applications, lost $3.7 billion in the second quarter.
It had already recorded net losses of 13.7 billion in 2022 and Meta predicts an even bigger addition in 2024.
During the earnings conference call, Mark Zuckerberg once again defended his vision of an immersive universe that would be the future of the internet.
“Adoption isn’t as fast as we thought it would be, so sobering,” he acknowledged, adding “understand the discomfort of investors” with these large investments with no return immediate.
“It’s a very long-term bet…and I can’t guarantee I’ll be right,” he continued. “But I think that’s the direction the world is going…and we’ll be glad we did it all.” »
Meta has also had to invest heavily in generative AI (capable of producing text and/or images on simple request in common language) to catch up with its neighbors Google, OpenAI and Microsoft.
Last week, the group made its Llama 2 language model free to businesses and researchers, a competitor to the OpenAI model, at work in ChatGPT and Bing. .
Mark Zuckerberg gave details on the generative AI products that Meta intends to develop: he mentioned creation tools (to facilitate the work of advertisers, in particular), internal productivity tools, and especially chatbots .
“This should solve one of the biggest problems we have in generating revenue from courier services,” he said, which is the cost of human resources needed to respond to consumers when interacting with businesses.
“But you can imagine a world where every business has an AI agent,” he enthused.
Some 3.88 billion people worldwide used at least one of the group’s platforms (Facebook, Instagram, Messenger and WhatsApp) every month in the second quarter.
