Meta, the parent company of Facebook and Instagram, has reported a higher-than-expected profit of $13.5bn for the most recent quarter, sending its shares nearly 7 percent higher.
Revenue in the April-June period came in at $39bn, above market expectations and up 22 percent compared with the previous year, Meta said in its latest earnings report on Wednesday.
The California-based tech giant said that it expected revenue in the third quarter to come in at between $38.5bn and $41bn.
“We had a strong quarter, and Meta AI is on track to be the most used AI assistant in the world by the end of the year,” Meta founder and CEO Mark Zuckerberg said.
“We’ve released the first frontier-level open source AI model, we continue to see good traction with our Ray-Ban Meta AI glasses, and we’re driving good growth across our apps.”
Meta’s strong performance comes after several of the tech giants that make up the “magnificent seven” mega-cap stocks reported mixed results.
Microsoft’s stock price plunged as much as 8 percent on Tuesday after the company reported lacklustre growth of its Azure cloud computing services despite revenues rising 15 percent year-over-year.
Google parent company Alphabet and Tesla also failed to satisfy investors with earnings reports last week showing YouTube advertising revenues and car sales, respectively, falling short of expectations.
The S&P 500 – which tracks 500 of the biggest companies listed on the US stock market – on July 24 registered its biggest daily decline since December 2022, falling 2.3 percent.
The tech-heavy Nasdaq index fell 3.6 percent on the same day, its steepest single-day decline since October 2022.
The rocky trading on Wall Street has been taken as a sign by some analysts that investors view the fanfare around AI as overblown.
Like other tech giants, Meta has poured billions of dollars into its data centres to position itself as a leader in AI.
In an open letter published last week, Zuckerberg laid out his vision for developing AI using open-source technology.
“I believe that open source is necessary for a positive AI future. AI has more potential than any other modern technology to increase human productivity, creativity, and quality of life – and to accelerate economic growth while unlocking progress in medical and scientific research,” Zuckerberg said.
“Open source will ensure that more people around the world have access to the benefits and opportunities of AI, that power isn’t concentrated in the hands of a small number of companies, and that the technology can be deployed more evenly and safely across society.”
