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Meta Shares Demonstrate Growth Due to AI

Currently, virtually all technology giants are somehow involved in the so-called artificial intelligence race, which requires significant costs, and at the same time all such companies strive to continue to be interesting from the point of view of investor priorities, which not everyone can combine, but Meta Platforms Inc. has succeeded significantly in this direction.

Meta Shares Demonstrate Growth Due to AI

This month, the value of Meta shares, led by Mark Zuckerberg, showed a significant increase of 13%. The upward dynamic of this indicator surpassed the average results demonstrated by other players in the technology industry in terms of pace. It is also worth noting that so far there has been no significant impact of statements by companies about massive amounts of financial injections into artificial intelligence and statements of intentions to continue to adhere to the appropriate approach. At the same time, the actual obvious fact is that AI is located in the territory of investor interest. Artificial intelligence has already demonstrated impressive cognitive abilities, can most likely surpass the human mind in the context of scale and depth of thinking, as predicted by Masayoshi Son, and has as yet untapped potential that can change the ways of production activities, make adjustments to existing models of economic development and launch certain transformational processes in the political environment and socio-cultural space.

On Thursday, August 22, the value of Meta shares rose by 1.7%, reaching $544.23 per equity. It is worth noting that in this case, a new historical maximum was recorded.

To a large extent, the upward trajectory of the value of the technology giant’s shares is because Mark Zuckerberg managed to convince investors that it helps to improve the results in the company’s core business. In this case, it means such a direction of activity of the company as digital advertising. Other firms, including, for example, Amazon.com Inc., Microsoft Corp., and Alphabet Inc., are not so clearly formulated, which means a kind of AI effect in the context of specific indicators of the functioning of their business.

Gene Munster, managing partner of Deepwater Asset Management, says that Mark Zuckerberg was able to convincingly explain to investors the short-term benefits of artificial intelligence, the long-term benefits, and the timing of the materialization of the results of the corresponding efforts.

Meta uses machine intelligence to help advertisers find the users they are interested in. Artificial intelligence increases the efficiency of the technology giant’s advertising business, which is the main source of its earnings. Meta also uses its own large language models to improve content recommendations. These models increase the level of user engagement on social media platforms such as Facebook and Instagram.

Mark Zuckerberg’s convincing vision for the introduction of artificial intelligence from the point of view of investors has already caused Meta’s financial performance to exceed experts’ expectations and forecasts. Against the corresponding background, JPMorgan’s Doug Anmuth stated that this technology giant continues to earn the right to spend big on generative machine intelligence.

At the same time, investors have recently increasingly viewed the massive financial injections of other companies into the artificial intelligence industry through the prism of a skeptical assessment. For example, last month, the value of Google shares turned out to be on a downward trajectory after information was released that in the second quarter of 2024, the capital expenditures of this technology giant, largely related to the implementation of AI programs and meeting the need for computing power, amounted to $13.2 billion instead of the expected experts and investors $12.2 billion.

It is worth noting that artificial intelligence as a kind of commercial project is focused on long-term goals. At the same time, there is currently no definitive understanding as to which AI configuration will be the peak and where the limit of this technology’s capabilities lies. For investors, the corresponding specificity of artificial intelligence in the context of forecasting means uncertainty and obscurity, which forces a very careful or even excessively cautious approach to financing AI initiatives. In this case, an example is observed that the lack of an understandable image of the future forces a person to move forward along the careful action path.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.