Meta Platforms Inc 2Q preview: Expecting a beat, ad revs. & external compute sales in focus

Research evidence excerpt

Meta Platforms Inc 2Q preview: Expecting a beat, ad revs. & external compute sales in focus

capabilities could drive deeper engagement and open up new monetization opportunities,

including subscriptions, etc., and 3) For the core advertising business, agentic usage could

further enrich company’s first-party data, improving ad targeting and monetization.

However, many challenges remain, such as developing high-value products ahead of

competitors, getting eCommerce companies to allow agents to interact with their sites, and

managing incremental costs for agentic capacity. See our note: Meta building agentic AI

assistants using new LLM.

Meta reassigns 7,000 workers to AI

Per reports, Meta is reallocating ~7,000 employees to AI-focused roles across agents

and applications. The reassignments come ahead of previously announced plans to

reduce headcount by ~10% (or ~8,000 employees) on May 20, as the company looks to

improve efficiency and offset rising AI infrastructure costs. Our Take: The changes could

potentially drive faster innovation cycles and help improve AI product velocity. However,

press reports also suggest low morale at Meta ahead of announced layoffs, and frequent

restructuring could also impact execution. We continue to see potential for positive product

surprises in 2H for Meta, as the company rolls out new products built on top of Muse Spark

and potentially more advanced LLMs. See our note: Meta reassigns 7K workers to AI ahead

of planned cuts.

Meta launches AI subscription offering

Per Bloomberg, Meta has launched a paid consumer subscription offering for its Meta AI

capabilities, introducing two tiers. The base tier, Meta One Plus at $7.99 per month, is

aimed at users generating images, videos, or using advanced reasoning features, while