Meta, the parent company of Facebook and Instagram, reported a profit of $5.7 billion (£4.6 billion) in the first quarter of this year, above estimates, despite job cuts.
According to a report, Meta attributed the positive results in its business to the use of artificial intelligence (AI).
The company’s overall revenue for the first quarter of the year was $28.6 billion, and Facebook’s monthly active users reached nearly three billion. “Our community continues to grow,” CEO Mark Zuckerberg remarked. “We’re also becoming more efficient so that we can build better products faster and put ourselves in a better position to deliver on our long-term vision,” he added.
The company sees “an opportunity to introduce AI agents to billions of people in ways that will be useful and meaningful,” Mr Zuckerberg said to investors.
He gave limited details but said Meta is looking towards boosting chat experiences in WhatsApp and Messenger, as well as graphic creation tools for Facebook and Instagram posts, and eventually expanding to video and multimodal interactions.
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Meta to generate its own AI
Meta aims to capitalize on its privately-owned generative AI, following in the footsteps of Google, as the industry is saturated with the hype surrounding the technology’s capabilities.
However, the company established Facebook’s AI Research lab in 2013, it has not made significant strides in this field compared to other tech giants like Microsoft.
According to Mr Zuckerberg, Meta is no longer lagging behind in constructing its AI infrastructure. He further mentioned that they are planning to launch generative AI products that can create graphics and sentences instantly in the upcoming months. This transition will not compromise the development of Meta’s virtual reality project, the metaverse.
Meta suffered a defeat
Meta’s Reality Labs segment lost $4 billion in the fourth quarter, and the company expects operating losses to rise year over year in 2023.
Regardless, Mark Zuckerberg denies that Meta is turning its attention away from the metaverse and affirms that the company will introduce its next Quest VR headset later this year.
The company’s cost-cutting tactics appear to have paid off, as seen by positive business results throughout this time period. Mr. Zuckerberg hopes to make 2023 an efficient year.
Job cuts, in general
Meta has led the way among big US IT corporations in downsizing, shedding approximately 20,000 jobs globally in a short period of time, accounting for about a quarter of its staff.
According to Debra Aho Williamson, chief analyst at Insider Intelligence, Meta’s year of efficiency is off to a better start than expected. She also added that reaching 3% year-over-year sales growth in the current economic context, following the obstacles faced in 2022, is a significant accomplishment.
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Preparing for economic uncertainty
Mark Zuckerberg admitted in 2022 that the economic climate was depressing and that it would be good to prepare for a prolonged period of economic uncertainty. Quilter Cheviot’s Ben Barringer applauded both Zuckerberg and Meta for their company development over the last six months.
He stated that the year-long emphasis on efficiency produced amazing results that exceeded expectations. Furthermore, when the macroeconomic situation improves, Meta is expected to recover further.