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Meta Platforms Inc. has made a strong case for investing heavily in artificial intelligence (AI) with impressive results this month, setting it apart from other major tech companies. The company’s share price rose by 13% this month, hitting a record high of $544.23, outpacing other leading tech stocks. This growth is in line with the company’s strategic capital investments and promise of more investment. It has appreciated by 0.3 %, approaching the previous month’s closing price, which was the highest on record.  Mark Zuckerberg’s clear vision of how AI affects Meta’s core operations, particularly digital advertising, has been instrumental in this positive outcome. Zuckerberg’s recent earnings call has been cited as convincing. AI boosts Meta’s advertising  Gene Munster, a managing partner at Deepwater Asset Management, agreed with Zuckerberg’s approach. He noted, “This was the best earnings call as a public CEO,” recognizing the concise explanation of the benefits of AI and the timeline for results.  Additionally, Meta’s AI efforts are centered on improving its advertising and content delivery systems. The company leverages AI to assist advertisers in finding interested users, which is significant given that almost all of Meta’s revenue comes from digital advertising. Also, Meta uses its big language models that are exclusive to enhance content suggestions on Facebook and Instagram to enhance user engagement.  This strategic application of AI has led to impressive financial results. In the second quarter, EPS and Meta’s revenue were much higher than analysts expected. JPMorgan’s Doug Anmuth pointed out that ‘Meta continues to earn the right to spend big on GenAI’, indicating investor support for the company’s AI spend.  Meta’s suite of apps, such as Facebook, Instagram, Messenger, WhatsApp, and Threads, has experienced a 10% growth in ad inventory for the second quarter of 2024. Similarly, the cost per ad has also gone…

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Filed under: News - @ August 23, 2024 12:22 am