Meta Platforms posted another quarter of impressive top line growth, with stronger advertising demand and rising ad prices lifting revenue sharply. However, the technology giant’s aggressive investment in artificial intelligence and restructuring initiatives significantly increased operating costs, dragging quarterly profit lower.

For the quarter ended June, the company generated revenue of US$60.80 billion, representing a 27 percent year on year increase, as advertisers continued to spend more across Facebook, Instagram and the company’s broader family of digital platforms.

At the same time, Meta recorded a 14 percent increase in ad impressions, while the average price per advertisement climbed by 12 percent, reflecting sustained demand for its advertising inventory.

Nevertheless, the company’s aggressive push into artificial intelligence substantially expanded its cost base. Consequently, total operating expenses surged 55 percent to US$42.03 billion, driven by continued AI investment, restructuring charges and legal expenses.

Specifically, Meta absorbed US$2.40 billion in legal related costs while also recording US$1.18 billion in severance expenses following the workforce reduction programme announced earlier this year.

Although revenue accelerated at a healthy pace, those higher expenditures weighed heavily on profitability. As a result, net income declined 13.57 percent to US$15.85 billion, highlighting the financial impact of Meta’s long term technology investments.

Meanwhile, the company’s workforce remained relatively stable during the reporting period, easing by just one percent to 75,472 employees. Even so, that figure is expected to fall further in the current quarter as approximately 8,000 additional job cuts take effect.

Looking ahead, Meta projected another strong quarter, forecasting September quarter revenue of between US$61 billion and US$64 billion, signalling confidence that advertising demand and AI powered products will continue supporting business momentum.

Commenting on the results, Meta Founder and Chief Executive Officer, Mark Zuckerberg, said artificial intelligence is no longer a future ambition but an increasingly important engine of growth across the company’s ecosystem.

According to him, AI is strengthening Meta’s existing businesses, accelerating the rollout of next generation products and creating entirely new commercial opportunities for enterprise customers.

He added that the company’s latest performance demonstrates the growing commercial value of its AI strategy while expressing optimism that further innovation will unlock even broader opportunities in the years ahead.

Despite the encouraging revenue performance, industry observers believe investors remain focused on the enormous financial commitment required to sustain Meta’s AI ambitions.

Senior Analyst at Emarketer, Minda Smiley, noted that the company’s revenue growth is likely to be overshadowed by mounting capital expenditure, particularly as shareholders seek greater clarity on Meta’s long term monetisation strategy for artificial intelligence.

She argued that investors will continue demanding more details about the company’s computing ambitions, future AI infrastructure plans and the commercial roadmap for turning its expanding AI ecosystem into a meaningful revenue generator.

Furthermore, Smiley observed that Meta’s recent communications campaign promoting its AI vision reflects an effort to present a more unified narrative around the technology as competition across the sector intensifies.

Even so, she suggested that the company’s optimistic messaging arrives at a challenging moment, with major social media platforms facing increasing criticism over concerns surrounding youth wellbeing and online addiction.

According to her, those contrasting narratives could complicate Meta’s efforts to build public trust while simultaneously positioning itself as a responsible leader in artificial intelligence.

She also pointed to Meta’s recent stream of product launches, including subscription offerings, new consumer applications and smart glasses, saying the company is clearly expanding beyond its traditional social media business.

However, Smiley questioned whether those initiatives represent a coherent long term strategy or simply a series of experimental product launches aimed at identifying the next major growth engine.

Meanwhile, in Australia, Meta ANZ Managing Director Will Easton described the quarter as a defining period for the company’s AI development programme.

He explained that Meta introduced Muse Spark 1.1, significantly enhancing Meta AI across its family of applications. Additionally, the company rolled out Meta Glasses and launched an AI powered business assistant designed to help advertisers automate campaign management while improving marketing performance.

Easton maintained that these innovations demonstrate the practical value of Meta’s AI investments, adding that the technology will continue expanding the company’s capabilities while creating more advanced solutions for enterprise clients and advertisers of every size.