Meta exceeds expectations with its impressive profit for the first quarter of the year
Despite job cuts, Meta, Facebook and Instagram’s parent company, has reported a profit of $5.7bn (Php 315bn) for the first quarter of this year, definitely exceeding expectations.
According to Facebook, artificial intelligence (AI) was “driving good results” across its business. Revenue totaled $28.6 billion, while users numbered just over three billion every month.
Chief executive Mark Zuckerberg said, “Our community continues to grow. We’re also becoming more efficient so we can build better products faster, and put ourselves in a stronger position to deliver our long-term vision.”
Zuckerberg told investors said that Meta sees “an opportunity to introduce AI agents to billions of people in ways that will be useful and meaningful.”
While offering certain details, he said that Meta was “exploring chat experiences in WhatsApp and Messenger, visual creation tools for posts in Facebook and Instagram and ads, and over time video and multimodal experiences as well.”
Because the industry is awash with the hype around the tech, the company plans to commercialize its privately-run generative AI, joining Google to find practical applications.
Despite Facebook’s AI Research laboratory being established in 2013, Meta has yet to make a significant impact in this field, as has Microsoft.
But Zuckerberg insisted Meta was “no longer behind in building our AI infrastructure” and said generative AI Meta products, which can instantly create sentences and graphics, would be released in the coming months.”
In addition, Meta’s virtual reality project, the metaverse, will not be affected by the move. During the last quarter, Meta’s Reality Labs division reported a net loss of $4bn. The company expects operating losses to increase in 2023.
According to Zuckerberg, the “narrative that has developed that Meta is moving away from the metaverse” is “not accurate”, but the company still plans to unveil the next Quest VR headset later this year.
Also according to the founder of the tech giant, the goal was to turn 2023 into “a year of efficiency.” During this time Meta has cut jobs and projects.
More than 20,000 jobs have been cut at Meta in just a few months, making it the most aggressive US big tech downsizing company.
Insider Intelligence principal analyst, Debra Aho Williamson, said, “The year of efficiency is off to a stronger-than-expected start for Meta. In this economic environment – and after the disaster that was 2022 – 3% year over year revenue growth is an accomplishment.”
Founder and CEO of Facebook, Mark Zuckerberg, has called 2022 “a humbling wake-up call” and said that we should prepare for the possibility that this new economic reality will continue for years to come.
“You have to take your hat off to Mark Zuckerberg and Meta given the transformation of the business over the last six months,” said Ben Barringer, from investment management firm Quilter Cheviot.
“The ‘year of efficiency’ Zuckerberg likes to talk about is bearing fruit. These results are a strong beat on the expectations and, given the improving macro backdrop, Meta should continue to recover well,” he added.
