Meta (META) has topped second quarter earnings expectations, beating estimates on both revenue and profit. However, concerns persist about whether the company’s substantial AI investments will generate revenue. Raymond James managing director of equity research Josh Beck joins Morning Brief to discuss his outlook on Meta.
Beck observes that Meta’s second-quarter results revealed a "much more positive narrative". While AI investments have driven up capital expenditure, he notes that the company "has a lot of different use cases lined up". Beck believes Meta’s "disciplined investment philosophy" is paying off, with the core ad business outperforming and already "benefiting from AI".
Regarding consumer engagement, Beck states, "There’s starting to be a new conversation on Meta, that you would’ve really never considered before." He highlights how Meta’s AI enables users to ask questions and interact more deeply on their platforms. However, he points out that investors may have overlooked Meta’s venture into the enterprise space.
"I think investors probably don’t quite give them credit for it at the moment, but that’s another little multi-year driver," Beck adds.
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