What metaverse? Meta says its biggest investment is now “advancing artificial intelligence”


About a year and a half after Facebook launched Renamed to “Meta” And saying it will focus on building a future version of the internet, called the Metaverse, the tech giant now says its top investment focus will be advancing artificial intelligence.

in a letter On Tuesday, CEO Mark Zuckerberg announced plans to employees lay off another 10,000 employees Over the next few months, he doubled down on his newfound focus on the company’s “efficiency.”The pivot for efficiency, first announced last month Meta’s quarterly earnings conference call, It comes after years of heavy investment in growth, including in areas of unproven potential such as virtual reality.

Now, Zuckerberg said the company will focus primarily on cutting costs and streamlining projects. Building out the Metaverse “remains at the heart of defining the future of social connectivity,” Zuckerberg wrote, but that’s not where Meta will spend most of its money.

“Our single biggest investment is advancing artificial intelligence and building it into every single one of our products,” Zuckerberg said on Tuesday. He expressed interest in how AI tools can help users of his apps express themselves and “discover new ” agreed, but also said the new AI tools could be used to improve internal efficiency by helping “engineers write better code, faster.”

The comments come after what the CEO described as a “humbling wake-up call” last year when “the world economy changed, competitive pressures increased and our growth slowed considerably.”

Meta and its predecessor Facebook were involved in Artificial intelligence research for many years, but the remarks come amid heightened mania for AI in the tech world, which began in late November when Microsoft-backed OpenAI publicly released ChatGPT. The technology quickly became popular for its ability to generate convincing, human-sounding responses to user prompts, then kicked off an apparent AI arms race among tech companies. microsoft announced In early February, it was integrating the technology behind ChatGPT into its search engine, Bing. The day before Microsoft’s announcement, Google launches its own AI tool Call Bud. and not be left behind, Yuan announced Late last month, it was forming a “top product group” to “accelerate” the company’s work on artificial intelligence tools.

“I do think that focusing on AI is a good thing,” Morningstar’s senior equity analyst Ali Mogharabi told CNN about Zuckerberg’s comments. Mogharabi said Meta’s investment in AI is “beneficial for both parties” because it can increase the efficiency of engineers creating products, and because incorporating AI capabilities into Meta’s family of apps may create more engagement time for users, thereby driving advertising revenue.

In the long run, Mogharabi said, “a lot of investment in AI, and a lot of enhancements that come from those AI investments, can actually be applied to the entire metaverse project.”

But Zuckerberg’s emphasis on investing in artificial intelligence and using the popular technology’s tools to make the company more efficient and boost profits is what “shareholders and the market want to hear,” Mogharabi said.many investors have complained before Ambitions and spending in the company’s metaverse. 2022, Yuan Losses of more than $13.7 billion In its “Reality Lab” unit, which contains its Metaverse endeavors.

Investors seemed to welcome Zuckerberg’s shift in focus from the Metaverse to efficiency. After taking a beating in 2022, Meta’s shares have soared more than 50% since the start of the year.

Angelo Zino, senior equity analyst at CFRA Research, said Tuesday that Meta’s second round of layoffs “officially leads us to believe that Mark Zuckerberg has completely reversed course, changing the company’s narrative to focus on efficiency rather than seeking to grow at all costs.” virtual universe.”

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