Meta’s second-quarter earnings report showed a significant boost in advertising revenue, largely thanks to improvements in traditional machine learning models rather than the company’s more ambitious generative AI (genAI) investments. According to CFO Susan Li, Meta doesn’t expect genAI work to drive meaningful revenue this year or next.
Instead, the company’s conventional machine learning models powering recommender systems saw a five percent increase in ad conversions across Instagram and a three percent gain on Facebook. These improvements are attributed to new AI-powered recommendation models designed to boost engagement by connecting users to friends, posts, and other content.
While Meta has high ambitions for genAI, with plans to use it to help users create advertising collateral and improve the algorithm on its platform Threads, these efforts are still in their early stages. The company is investing heavily in infrastructure and talent to build new systems that not just match human intelligence but exceed it.
In the short term, Meta’s reliance on traditional machine learning models is paying off. The company reported a 36 percent year-over-year increase in profits to $18.3 billion on revenues of $47.5 billion. However, CFO Li emphasized that genAI will eventually play a bigger role in the advertising business, citing strong results from text generation tools and LLMs driving ranking-related time spent gains on Threads.
Source: https://www.theregister.com/2025/08/01/meta_ai_investments