Meta is locked in a bitter rivalry with other tech behemoths racing to invest heavily in AI, aiming to ensure the technology generates profits in the not-so-distant future.
Most analysts believe Meta will make the investment pay off by improving advertising efficiency and creating new opportunities, such as with its smart glasses through a partnership with Ray-Ban maker EssilorLuxottica.
Meta is ramping up spending to record highs, announcing an array of multi-billion-dollar deals with AI partners and incentivising employees to be more productive by using AI agents for coding and other tasks, according to Wedbush analyst Dan Ives.
Ives reasoned that more layoffs could be in store at Meta this year as part of a strategy to use AI to gain efficiencies.
“We believe that this is part of Meta’s strategy to increasing leverage AI tools to automate tasks that once required large teams, allowing the company to streamline operations and reduce costs,” Ives said in a note to investors.
“We are encouraged by management’s cost-cutting efforts thus far.”