Meta to plough billions into artificial intelligence

FACEBOOK owner Meta has posted its fastest sales growth in nearly three years – but shares fell as it ramps up spending on artificial intelligence.

In an announcement last night, the social media firm posted revenues of £29.2bn for the three months to the end of March, up 27pc from the year before.

This is the fastest rate of growth since the third quarter of 2021 for Meta, which owns Instagram and Whatsapp as well as Facebook. Profits more than doubled to £10bn from £4.6bn the year before.

‘It’s been a good start to the year,’ said Mark Zuckerberg, Meta founder and chief executive. We’re seeing healthy growth across our apps and we continue making steady progress building the metaverse as well,’ he added.

However shares were down after the bell as the firm warned that overall expenses this year would be higher than it previously forecast as it pumps cash into artificial intelligence. Meta is set to spend as much as £32bn in 2024 – up from a previous forecast of £30bn.

The update follows a bumper 2023 for the group, which saw the Silicon Valley titan post revenues of £106bn, up 16pc from the year before. This prompted the company to pay out dividends to investors for the first time. It rounded off Zuckerberg’s so-called ‘year of efficiency’, which saw the firm lay off 21,000 staff and cut several innovative projects.

Tech giants such as Amazon, Google parent Alphabet and Microsoft also made significant cuts to their headcount.

And Meta’s shares have rallied by more than 40pc since the start of this year as the investors cheer a successful turnaround for the group.

Meta’s value slumped throughout 2022, wiping out over three-quarters of their value at the time.

It came as advertisers started to cut budgets in the face of economic uncertainty and high interest rates.