According to CEO Mark Zuckerberg, it will take a while to realize substantial revenue from artificial intelligence because Meta Platforms has been extremely pursuing it.
Speaking on the first-third earnings call Wednesday evening, Zuckerberg said the business parent of Facebook, Instagram, Whatsapp, and Threads may commit “considerably more” to support and help increase its AI development efforts.
“As we’re cutting back on our energy and CapEx for AI,” he said to analysts and investors present on the call, “We’ll continue to focus on operating the rest of our company efficiently, but realistically, even with shifting many of our existing resources to AI, we’ll still grow our investment envelope significantly.”
Llama 3 and its Meta AI assistant, which use the large language model, are some recent AI initiatives by Meta.
For 2024, Meta on Wednesday changed its prediction for capital expenditures, lifting it to $35 billion to $40 billion. Additionally, it stated that capital expenditures would increase in the following year as well, without setting a specific price range.
Zuckerberg noted Meta shares have experienced “a lot of volatility” in the past while in the period of “investing in scaling a new product but aren’t yet monetizing” like Reels and Stories.
“I also anticipate a multi-year investment cycle before we fully scaled Meta AI, business AIs, and more into the profitable services I want as well,” he said.
Meta Rolls Out Upgraded AI Assistant Across Facebook, Instagram and WhatsApp.
Historically, investing to create these new scaled experiences in our apps has been a very good long-term investment for us and for investors who have stayed with us, and the initial signs are quite positive here too. However, he continued, “Building the leading AI will also be a larger undertaking than the other experiences we’ve added to our apps, and this will probably take several years.”
The Meta CEO mentioned a number of ways the company planned to reduce costs as part of its AI scaling initiatives, including expanding the open source community and developing more of its own chips.
He claimed that the accomplishments Meta teams have made so far in AI products represent “another significant milestone in demonstrating that we have the talent, data, and ability to scale infrastructure to create the world’s leading AI models and services.”
In the first quarter, the company generated $36.46 billion in revenue, marking a 27% jump from the same three-month period in 2023. Its net income, meanwhile, went from $5.91 billion to $12.37 billion.
