Meta reports record profit amid aggressive AI investment

In the United States, Meta Platforms Inc. reported a significant increase in profit and revenue for the fourth quarter of the fiscal year. The company earned $20.83 billion, or $8.02 per share, marking a 49% increase compared to the same period a year prior. The revenue surged by 21% to $48.39 billion from $40.11 billion, exceeding analysts' expectations, who had predicted earnings of $6.76 per share on revenue of approximately $47 billion. These results were largely driven by higher advertising revenue across Meta's social media platforms, reflecting a potential recovery in the digital advertising sector. CEO Mark Zuckerberg noted the positive performance despite a competitive digital ad market, indicating the company's robust strategies in navigating uncertainties. Furthermore, Meta is expected to face rising expenses as it invests aggressively in artificial intelligence infrastructure and capital expenditures, with forecasts suggesting expenses in the range of $114 billion to $119 billion for the coming quarter. However, Wednesday's report reassured investors of Meta's profitability and growth potential in light of the projected increases in expenditures. Notably, the company’s stock experienced an uptick of $13.53, or 2%, in after-hours trading, illustrating investor confidence despite concerns of elevated spending on AI initiatives that could present risks if not well managed. Zuckerberg reiterated his expectations for 2025 to witness a highly capable AI assistant operating for over a billion users, signaling Meta's commitment to maintaining an edge in technology advancements and competitive relevance. Lastly, Meta's efforts to recast its relations with government entities were discussed during the earnings call, with Zuckerberg expressing optimism regarding cooperation with the U.S. administration’s support of technology advancements. Concurrently, the company has settled a lawsuit with President Donald Trump for roughly $25 million, which was prompted by the suspension of Trump’s accounts following the January 6th Capitol incident, further highlighting the political dynamics influencing Meta's corporate strategy.