The company has successfully utilized artificial intelligence to grow its ad business and take share from Google Ads.
Meta's ad revenue grew 21% YoY to $46.6B in Q2-FY25, driven by AI models improving ad relevance and conversions. Instagram conversions rose 5% and Facebook 3% YoY as AI-powered tools like Andromeda, GEM, and Lattice boosted advertiser ROI. Family of Apps generated 99.2% of revenue at $47.1B, sustaining a strong 53% operating margin despite high AI investments.
The market is likely to close the year at new highs. Here is the reasoning:
Shares of Magnificent Seven stock Meta Platforms NASDAQ: META have gone on an extremely impressive run thus far in 2025. Year to date, the stock has provided a total return of just over 26%.
Meta reportedly plans to introduce its new smart glasses at next month's “Connect” conference. Those glasses, Meta's first to feature a consumer-ready display, will be announced at the annual conference along with a wristband that lets users control the glasses via hand gestures, CNBC reported Friday (Aug. 22), citing sources familiar with the matter.
Meta is set to launch two new smart glasses at its annual Connect developer conference in September. That includes its first consumer-ready glasses with a display and a wristband that will allow users to control the glasses with hand gestures, potentially paving the way to AR glasses.
Pinterest and Meta ramp up user growth, AI tools, and ad innovations as both chase a bigger slice of the booming social commerce market.
Meta Platforms, Inc. remains a high-growth, high-margin business, defying maturity expectations with 20%+ revenue and 40%+ profit expansion. Aggressive AI-driven capital expenditures position Meta for another growth phase, with management signaling $68B in 2025 CapEx and continued investment in 2026. Despite CapEx risks, Meta's dominant platforms and profitability support confidence in sustainable long-term growth and market leadership.
Meta Platforms delivered a blowout Q2, crushing revenue and EPS estimates, driven by AI-fueled ad growth and unmatched user engagement across its ecosystem. I remain extremely bullish, seeing a long growth runway as Meta leverages AI, wearables, and its massive user base to unlock new revenue streams and profitability. The market is underestimating Meta's AI wearables and future earnings potential; current forward multiples are low, making shares attractive for long-term investors.
“It's beyond enormous. It's unprecedented.
Meta's AI integration is driving robust top-line growth, with Q2 revenues up 21.6% YoY and ad impression growth accelerating across all regions. Margin expansion and operational efficiency have led to a 38% YoY EPS increase, justifying Meta's elevated but fair valuation. Heavy CAPEX is weighing on free cash flow, but these investments are necessary for long-term AI-driven growth and remain worthwhile.
OpenAI is asking Meta to produce evidence related to any coordination with Elon Musk and xAI to acquire or invest in the ChatGPT-maker.