Social media Zuckerberg invests billions in AI development

The Facebook group Meta is using its booming advertising revenue for an expensive bet on artificial intelligence. The prospects of success are still unclear - but boss Mark Zuckerberg is spending more and more money on it in the hope of getting a head start.

This year, long-term investments will amount to at least 38 billion dollars, including for the expansion of data centers for AI - one billion more than previously expected. And next year, spending is expected to increase further.

Meta is gradually integrating AI software that can create texts or images, for example, into its apps such as Facebook and Instagram. According to the company, this brings Meta AI to 500 million monthly active users. According to Zuckerberg, AI is already having a positive impact on the Group's business.

Dream of digital worlds costs many billions

Zuckerberg has already incurred losses of more than 50 billion dollars for his vision of virtual worlds in which he expects people to work and spend their free time. In the last quarter alone, the company's Reality Labs division posted operating losses of 4.4 billion dollars. And that with a turnover of just 270 million dollars.

In the conference call following the presentation of the quarterly figures, one analyst wondered whether the losses had perhaps reached their peak. CFO Susan Li said that the company would continue to invest heavily in Reality Labs because it was a long-term strategic priority.

Reality Labs is primarily known for VR goggles that allow users to immerse themselves in digital worlds. Meta is currently trying to tap into a broader market with the new, cheaper Quest 3S model. Zuckerberg is also focusing heavily on ordinary-looking glasses with a camera and small speakers. They are designed to provide the AI software with helpful context for user queries. Meta is also developing glasses that can superimpose digital objects into the real environment for the wearer.

Advertising business pays for everything

However, Meta can still easily afford these expenses. Even after the huge loss at Reality Labs, consolidated profit rose by 35 percent year-on-year to around 15.7 billion dollars. Group turnover grew by almost a fifth to 40.6 billion dollars.

Every day, 3.29 billion users access at least one app from the Group, which includes Facebook, Instagram and WhatsApp. WhatsApp broke the mark of two billion calls per day.

Meta forecast sales of between 45 and 48 billion dollars for the current quarter. The market had been expecting an average forecast of a good 46 billion dollars. The share price fell by a good three percent in after-hours trading.

SDA