Meta Q3 - It's all AI baby

Vestact-recommended Meta Platforms reported third-quarter numbers on Wednesday night, showing that it is doubling down on its long-term AI and augmented reality ambitions. CEO Mark Zuckerberg outlined plans for sustained investment in infrastructure and emerging products. The company's pivot into AI has been a driving force behind its 67% stock price increase this year, making it one of the S&P 500's top performers.

Meta creates platforms that are used by advertisers, and revenues rose 19% this year to a record $40.6 billion. AI tools are used to improve user engagement with ads and it seems to be working. Monthly active users on Meta's sites rose by 500 million. Engagement time on Facebook was up 8% and on Instagram up 6%. One million advertisers used AI-generated ads which delivered a 7% uptick in campaign conversions.

Meta's Reality Labs is churning out very promising augmented reality glasses and other devices. That division reported a $4.4 billion quarterly operating loss. Threads, which is Meta's answer to X, remains a notable long-term asset, now reaching 275 million monthly active users.

Looking forward, Meta's ability to turn AI into a foundational revenue driver provides a strong case to hold this share. While high R&D costs persist, the disciplined investment approach is expected to yield substantial gains.