Meta's business AI tools hit 10 million weekly conversations as ad revenue surges

Meta says its business AI now facilitates 10 million conversations a week | TechCrunch

Meta doesn't come up much in discussions of the top AI products these days, but its products are still benefiting from the ongoing surge of interest in the technology. The company's business AI tools facilitated about 10 million conversations per week as of late March, up from 1 million in the beginning of this year, Meta said during its first-quarter conference call on Wednesday. The growth comes as the company recently expanded the beta program of its business AI assistant in the U.S., EMEA, APAC, and LATAM. Meta isn't monetizing its business AI tools yet, offering them for free to small businesses to achieve scale, but CEO Mark Zuckerberg hinted that may change in the near future. "Business AIs today are currently free for most businesses on our messaging apps, but as we make more progress, we expect that we will also work towards establishing a longer-term monetization model," Zuckerberg said during the call. Meta has been baking AI capabilities into its suite of business products on its various platforms, and is working to power these products with its new large language model, Muse Spark, the first one to be released under the Meta Superintelligence Labs division set up last year. The company said it has seen solid traction for its creative AI tools in the quarter. "Usage of our ad creative tools is also scaling, with more than 8 million advertisers using at least one of our GenAI ad creative tools, and particularly strong adoption among small and medium-sized businesses. These tools are benefiting performance as well, with advertisers using our video generation feature seeing more than 3% higher conversion rates in tests," CFO Susan Li said on the call. The company is also launching the open beta of Meta Ads AI Connectors this week, which will let advertisers connect their Meta ad account to an AI agent. Zuckerberg noted that the company's apps altogether generated revenue of $885 million in the quarter, largely due to demand for paid messaging on WhatsApp and subscriptions to its apps. Earlier this month, the company started testing a WhatsApp Plus subscription that gives users access to custom icons, themes, and notification sounds. The company reported profit of $26.8 billion in the first quarter, up from $16.6 billion a year earlier. Revenue came in at $56.3 billion, up 33% from last year.

Meta's Q1 earnings show AI driving engagement, ad gains across platforms

Meta's AI advancements are boosting user engagement and ad revenue significantly. Higher video consumption on Instagram and Facebook, coupled with improved ad conversion rates, highlight AI's impact. The company is expanding AI-powered tools for content discovery and advertiser solutions, driving substantial growth and promising further innovation. Artificial intelligence (AI) is driving gains in engagement and advertising at Meta Platforms, with the company reporting higher video consumption, improved ad conversions, and wider adoption of AI tools across its apps in the first quarter of FY26. On Instagram, "ranking improvements... drove a 10% lift in Reels time spent," Meta chief executive Mark Zuckerberg said, while on Facebook, total video watch time rose more than 8% globally, including a 9% increase in the US and Canada. Zuckerberg added that more than 3.5 billion people now use at least one of the company's apps daily, underscoring the scale at which these systems operate. The gains come as Meta expands the use of AI-powered recommendation systems to surface more relevant content to users. Also Read: Meta layoffs: More cuts possible after 10% workforce reduction on May 20 AI reshapes content discovery Meta said improvements in its recommendation infrastructure are enabling faster and more personalised content delivery. The company has increased the depth of data used to train its models, including longer user interaction histories that describe how users engage with content. "We've significantly increased the speed with which our ranking models index new posts... enabling us to recommend them sooner after they are published," Zuckerberg said. As a result, same-day posts now account for more than 30% of recommended Reels across Instagram and Facebook, more than double the level a year earlier. The company is also using AI to expand content accessibility. "Over half a billion users on each of Facebook and Instagram are now watching AI-translated videos weekly," he added, referring to tools that automatically translate and dub video content into local languages. Meta added that it is continuing to refine large language model-based systems that allow users to provide more granular feedback on content preferences, helping improve personalisation over time. "We're continuing to improve our data infrastructure so our models can train on more data. We're also focussed on making recommendations more personalised and relevant to each user's interests," said Susan Li, Meta's chief financial officer. "Users with more concentrated interests may see more of that specific content, while those with broader interests will see a wider range of topics." AI-led ad gains Advances in AI are also contributing to improvements in Meta's core advertising business, which accounts for the majority of its revenue. Average price per ad increased 12% on-year, per the company's financial disclosures. Li added that more than 8 million advertisers now use at least one of the company's generative AI ad tools, up from 4 million at the end of 2024. These include video generation, image animation, and automated creative optimisation across formats such as Reels, Feed, and Stories. Li said that advertisers using its video generation feature saw a 3% increase in conversion rates compared with those that did not use the tool. The company also reported broader gains from upgrades to its ad delivery systems. Enhancements to its Lattice and GEM model architectures drove "more than a 6% increase in the conversion rate for landing page view ads" during the quarter. These are Meta's internal AI systems used to decide which ads to show, to whom, and when. Meta said its Adaptive Ranking Model, an AI-based system that routes ad requests to the most effective and efficient models where conversion probability is higher, contributed to a 1.6% increase in conversion rates across its major platforms. In addition, Meta's AI-powered business assistant for advertisers has now been fully rolled out, providing campaign recommendations and resolving account issues. The company said common advertiser issues are now being resolved "at a 20% higher rate" compared with earlier testing phases. "There is still a lot of room to continue improving recommendations over the rest of the year, and we expect we'll be able to do that to drive additional engagement on both Facebook and Instagram," Li added. Scaling AI infra Meta said it is continuing to invest heavily in infrastructure to support its AI roadmap, including servers, data centres, and network capacity. Capital expenditure for the quarter stood at $19.8 billion, reflecting increased investment in compute resources required for training and deploying advanced models. Meta reported a first-quarter operating income of $22.9 billion, representing a 41% operating margin, while its net income stood at $26.8 billion. The company said it expects continued improvements in recommendation quality and ad performance as it scales its AI systems further across its platforms. "There's going to be massive upside in delivering more intelligence and capabilities. This is one of the most exciting times in the industry," Zuckerberg said, and added: "AI agents are the product vehicle for bringing those capabilities to people, and this year will be a key period for establishing that," Zuckerberg added.

Meta's Business AI Handling 10 Million Weekly Conversations | PYMNTS.com

Speaking during the company's Wednesday (April 29) earnings call, CEO Mark Zuckerberg said these tools were handling 10 million conversations a week by late March, compared to 1 million at the start of the year. And while Meta has not begun monetizing its business AI tools yet as it offers them gratis to small businesses as it attempts to scale, the founder hinted that could change. "Business AIs today are currently free for most businesses on our messaging apps, but as we make more progress, we expect that we will also work towards establishing a longer-term monetization model," Zuckerberg told analysts. Muse Spark, Meta's first model from the company's in-house artificial intelligence (AI) lab, debuted during the first quarter and now powers Meta AI across all apps and the standalone Meta AI app. Sessions per user grew double digits following the introduction, with more advanced models now in training. Meta also rolled out Meta Ads AI Connectors in open beta, allowing advertisers to connect their ad accounts to external AI agents for campaign management and optimization. Susan Li, Meta's chief financial officer, also noted that use of the company's creative tools was scaling as well, with upward of 8 million advertisers using at least one of these offerings. Adoption has been especially strong among small and medium-sized businesses. "These tools are benefiting performance as well, with advertisers using our video generation feature seeing more than 3% higher conversion rates in tests," Li said. Meanwhile, Zuckerberg covered Meta's long-term vision for AI during the call, framing personal superintelligence as the company's chief product goal. "My view is that human progress has always been driven by people pursuing their individual aspirations," he said. The company also upped its full-year guidance for capital expenditures, going from its earlier range of $115 billion to $135 billion to a new projection of $125 billion to $145 billion. Meta cited rising cost of memory and additional data center capacity, and acknowledged that it has consistently underestimated its compute needs. As PYMNTS wrote in March, this level of spending puts Meta in the company of some of the biggest investors in AI infrastructure, including Amazon, Google and Microsoft. Meta is also reportedly slashing jobs in a move that is widely viewed as an effort to offset the investments it has been making in AI infrastructure. Last week saw a report that the company would cut 8,000 jobs, and leave another 6,000 positions unfilled.