Meta’s Q1 2025 earnings delivered more than just strong results, they offered the clearest signal yet that the company’s multi-billion-dollar AI strategy is beginning to pay off. Revenue rose 16% year-on-year to $42.31bn, exceeding internal forecasts and Wall Street expectations. Almost all of that — $41.4bn — came from advertising.
But the real story lies in the how. While ad impressions across Meta’s family of apps — Facebook, Instagram, WhatsApp and Threads — rose 5%, it was the 10% increase in average price per ad that stood out. Advertisers aren’t just spending more, they’re paying a premium, likely due to enhanced targeting, campaign performance and AI-driven creative automation.
Meta also reported a 30% increase in advertisers using its AI tools to generate creative assets. These include automation features that resize video ads to fit multiple formats, increasingly vital in a fragmented media landscape. For media buyers, the pitch is clear: Meta’s platform doesn’t just serve ads; it now helps make them faster and more efficiently than many creative teams can.
That shift positions Meta less as a social network, and more as an AI-powered marketing operating system, one that blends reach with performance and automation at scale. ‘AI has already made us better at targeting and finding the audiences that are interested in [advertisers’] products than many businesses are themselves’, founder and CEO Mark Zuckerberg said. ‘And now, AI is generating better creative options for many businesses as well.’
This isn’t just a product story. It’s a strategic realignment, and it has implications for the traditional media buying ecosystem. Platforms once sold access, now they’re offering end-to-end ad production and delivery. As Meta’s tools grow in sophistication, the line between tech partner and agency competitor is blurring. But increasingly, Meta isn’t just creating more inventory, it’s creating more compelling ways to monetise attention using AI.
Business analyst Ian Whittaker observed on LinkedIn: ‘While it is also targeting creators, the AI content is probably key here to boosting ad revenues. If you can get more people to spend more time on the platform you will probably get more ad revenues’.
The metaverse, once central to Meta’s future, was barely mentioned. Reality Labs posted a $4.2bn loss, but investor focus has shifted to AI infrastructure, with full-year capital expenditure guidance rising to $64–72bn. Meta is investing not just in tools, but in scale — including a new data centre reportedly the size of Manhattan.
The launch of Meta’s standalone AI chatbot, designed to rival ChatGPT and integrate across its ecosystem, further underscores the platform’s ambitions. Zuckerberg claimed nearly one billion monthly active users for Meta AI — a broad metric, but one that speaks to the scale of its deployment.
The big question now isn’t whether Meta’s AI tools work, it’s how far up the funnel Meta wants to go. If it continues to automate targeting and creative, media buyers may find themselves not just spending on the platform, but increasingly relying on it to do their jobs.
As Zuckerberg put it: ‘This is really redefining what advertising is — into an AI agent that delivers measurable business results at scale’.
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