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Meta shares rise as steady spending eases investor concerns

Meta shares surge over 11% as steady capital spending boosts investor confidence amid ongoing AI investment successes

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2 months ago

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Meta shares surge over 11% as steady capital spending boosts investor confidence amid ongoing AI investment successes

In Short:
– Meta’s capital-spending forecasts ease investor worries, with shares rising over 11% after the announcement.
– The company exceeded sales and net income expectations, predicting 17% to 24% revenue growth this quarter.
Meta has reported steady capital-spending projections for the first time this year, alleviating investor concerns regarding Chief Executive Mark Zuckerberg’s AI investments.
Shares surged over 11% in after-hours trading following these announcements.The company’s advertising business continues to fund its ambitious AI initiatives, with sales reaching $47.5 billion, surpassing analyst expectations.

Net income for the April-to-June period was $18.3 billion, also exceeding market predictions. Meta anticipates revenue growth between 17% and 24% year-over-year for the current quarter.

AI Investments

Zuckerberg has focused on developing personal superintelligence through recent investments, including a $14 billion stake in Scale AI.

Despite setbacks with launching new AI models, he is optimistic about AI transforming Meta’s advertising and user experience.

Challenges remain, particularly in attracting and retaining AI talent, with Zuckerberg reportedly offering lucrative packages to prospective researchers.

Consequently, Meta’s daily active users grew by 6% year-over-year in June, reflecting user engagement across its apps.



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