META CEO Mark Zuckerberg believes that smart glasses can replace (or at least reduce) smartphones over the next 15 years.
Meta is well known as a digital advertising giant and uses AI to strengthen this part of its business, but the company is also a leader in Smart Glasses.
Wall Street estimates that Meta profits will increase by 17% annually over the next three years, making the current estimate of 29 times the profit seems fair.
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Apple Introduced the first iPhone at the Macworld Conference in 2007. Former CEO Steve Jobs explained the product as a combination of iPod Touch, mobile phone and internet communication devices. “The iPhone is a revolutionary and magical product that is literally five years older than any other mobile phone,” he said.
Although not the first smartphone, the iPhone redefines the product category and has quickly become an industrial standard with its touch interface, virtual keyboard and ability to serve numerous use cases (ie music player, web browser, phone) with one device. But this is the reason why the smartphone is ultimately replaced by another revolutionary technology.
Meta platforms(Nasdaq: Meta) CEO Mark Zuckerberg believes that smart glasses will gradually replace smartphones over the next decade. His company is already a market leader with its Ray-Ban Meta AI glasses, but Zuckerberg believes that Augmented Reality displays will make the technology truly transformative.
Image source: Getty Images.
Meta Platforms runs the nascent Smart Glasses market, which has tripled last year and is expected to grow more than 60% annually in 2029 for Counterpoint Research. Meta has more than 60% market share with its Ray-Ban intelligent glasses that allow users to listen to music, take photos and videos and ask their assistant to Meta AI artificial intelligence. But the company has more aspirations.
Meta presented ORION last year, its first smart glasses with a true expanded reality (AR). The glasses will have a large holographic display, which combines the physical and digital world, overlapping the field of content such as video and applications. Orion AR goggles will be controlled with eye movements and EMG wrist lane (electromyography), which turns electrical signals into digital commands, leaving users to spray, click and scroll through content.
Imagine watching NetflixBut instead of transmitting the contents of a television screen, glasses will overlap the physical world with a holographic display. What happens when you get a text message? Smart glasses can show a second holographic window that allows you to answer. Now let’s say you see someone wearing stylish clothing in this Netflix show. You can ask the AI assistant for details about the brand and the price. Meta hopes to achieve all this and more with Orion.
I am not convinced that smart glasses will ever completely replace smartphones, but I think they will reduce their importance in almost the same way that smartphones have reduced our dependence on computers. If intelligent glasses really become the next large product of consumer electronics, Meta may be apple over the next decade because of its market leadership. But there are other reasons to own stocks today.
Meta platforms report strong financial results from the second quarter, which defeats the estimates of the top and bottom lines. The revenue increased by 22% to $ 47.5 billion, with the operating margin increasing by 5 percentage points and the net income GAAP increasing by 38% to $ 7.14 a thinned share.
Investors have a good reason to think that Meta can maintain its inertia. This is the second largest advertising technology company worldwide because of its popular social media properties, and advertising technology sales are predicted to increase by 14% annually by 2030, according to Grand View Research. But the revenue from Meta advertising can increase faster due to their investments in artificial intelligence.
Executive Director Mark Zuckerberg, at the most profit revenue, said: “AI significantly improves our ability to show people content that they will seem interesting and useful.” Better algorithms have led to a 5% increase in the time spent on Facebook and a 6% increase in the time spent on Instagram. More brands also use Meta Ai Creative Tools, which have increased ads with 3% ads on Facebook and 5% on Instagram.
In addition, Meta in June announced channel and advertising subscriptions at WhatsApp, the fourth most popular social media network from monthly active users. Plans to provide revenue from application Create a new stream of revenue Morgan Stanley Analyst Brian Novak believes he can reach $ 3 billion to $ 6 billion by 2027.
Wall Street expects the profit of meta platforms to grow by 17% annually over the next three years. This makes the current evaluation of 29 times the profit seems quite reasonable, especially because the company wins the evaluation of a consensus profit on average 16% in the last six quarters.
Here’s the bottom row: Meta platform shares have generated a return on Monster 338% over the last three years due to thriving sales of ads and AI investment should further find this part of their business. But Meta is also the leader of the nascent intelligent glasses market that can become another essential source of revenue. Patient investors should feel comfortable buying a small position today.
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Trevor Geneeen has no position in any of the mentioned shares. Motley Fool has positions and recommends Apple, Meta platforms and netflix. Motley Fool has a policy of disclosure.
1 stock of monster growth to buy now – its technology can replace the smartphone (hint: not Apple), originally published by Motley Fool
