Meta's AI Isn't Just Smart — It's Paying The Bills

Benzinga
2025.07.31 13:22
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Meta Platforms Inc reported a strong second quarter with a 22% revenue increase, driven by AI tools optimizing ad delivery on Instagram and Facebook. Despite challenges, its automated ad platform, Advantage+, performed well, attracting advertisers. Looking ahead, Meta plans a significant $100 billion capital expenditure by 2026 to support its superintelligence vision, leveraging its current ad success to fund this ambitious goal. Investors are optimistic about Meta's ability to monetize engagement through AI, setting the stage for future growth.

Meta Platforms Inc META just dropped a blowout second quarter — but the real headline isn't the numbers, it's the algorithm. According to JPMorgan's Doug Anmuth, Meta's AI isn't just writing code or generating Llama buzz. It's quietly monetizing user attention and paying for the next leap: Superintelligence.

Track META stock’s post-earnings move here.

AI That Converts While You Scroll

Meta's second-quarter revenue surged 22%, powered by a sharp uptick in ad pricing (+9%) and impressions (+11%). At the core of this momentum are Meta's AI ranking tools — Andromeda, GEM, and Lattice — which are optimizing ad delivery across Instagram and Facebook, noted Anmuth. GEM alone boosted conversions by 5% on Instagram (IG); Lattice lifted Facebook (FB) conversions by 4%. Time spent watching video on IG and FB also jumped more than 20% year-over-year, thanks to smarter feed curation.

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Despite a bumpy rollout of Llama 4 and some AI team reshuffling, Meta's ad engine didn't flinch. Advantage+, its automated ad platform, drove stronger-than-expected returns, and Asia-based advertisers came roaring back. The result: a business that's humming, even as the spotlight shifts to AGI ambitions.

Super Capex For Superintelligence

While AI is monetizing today's engagement, Meta is prepping for something bigger — and much more expensive. Management hinted at a jaw-dropping $100 billion capex target in 2026, up sharply from this year's $66 billion–$72 billion. That investment will go toward compute-heavy infrastructure to support its vision of personal superintelligence.

For now, Meta's strong ad business gives it the financial runway to spend aggressively. But as Anmuth notes, the company remains compute-constrained and is eyeing co-development partnerships to stay flexible. Investors are rewarding the monetization story, but the stakes are rising fast.

If Meta's AI can keep converting engagement into dollars, it might just earn the right to chase the future.

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