Meta Quantifies AI Monetization

Though we might still note that artificial intelligence benefits often are somewhat indirect or hard to measure, Meta joins the ranks of firms pointing to financial benefits from AI. 

“AI is transforming everything we do,” said Meta CEO Mark Zuckerberg. Specifically, he sees “improved advertising, more engaging experiences, business engaging experiences, business messaging, Meta AI and AI devices” as opportunities.

“In just the last quarter, we are testing a new ads recommendation model for Reels, which has already increased conversion rates by five percent, and we're seeing 30 percent more advertisers are using AI creative tools in the last quarter as well,” he noted. 

“In the last six months, improvements to our recommendation systems have led to a seven percent increase in time spent on Facebook, a six percent increase on Instagram, and 35 percent on Threads,” Zuckerberg added. 

So even if the impact is somewhat indirect, Meta's advertising revenue, which constitutes the vast majority of its total revenue, continues to benefit significantly from AI-driven enhancements. In the first quarter of 2025, Meta reported revenue of $42.31 billion, a 16 percent year-over-year increase, with advertising revenue estimated at around $40.57 billion. 

That does not necessarily mean all the upside was because of AI, but AI-powered tools, such as the Advantage+ marketing service, have improved ad targeting and relevance, leading to a 70 percent growth in Advantage+ adoption. That might be said to have driven higher ad impressions and an 11 percent increase in average price per ad. 

Likewise, AI-driven content recommendation systems have increased user retention and engagement, with an eight-percent increase on Facebook and a six-percent growth  on Instagram. 

While Meta AI is not yet a significant revenue driver, Zuckerberg has talked about plans to monetize it in the future, potentially through ads or a premium subscription model. 

Meta’s commentary complements that of Alphabet, which in its latest quarterly financial report talked about AI  monetization as well.