Meta Is Investing in Augmented Reality – Will it Pay Off?

The metaverse may not live up to the hype in the years ahead, but Meta Platforms (META 1.86%) can still be a major player in augmented reality. In this clip from “Ask Us Anything” on Motley Fool Live, recorded on June 14Fool.com contributor Jose Najarro discusses how the company’s use of AR in one particular area will be a money maker.

Jose Najarro: Investments in AR and VR, I’m not trying to say the metaverse is the future, but I do think augmented reality and virtual reality are going to play an important role in some form of advertising. We’re seeing a lot of companies do like, “Hey if you want to buy this couch, use your camera real quick to see how it fits inside your living room.” I think again, I do think augmented reality is going to play a nice role in advertising, which is where Meta Platforms makes most of its money.

They are also investing in their core products. Even though some people might say they’re just copying, some of their competitors, like they aren’t doing a lot more short-term, videos on their platforms, which is a copy of TikTok. I do believe at the end of the day it’s just another solution for their core products.

There’s obviously some bearish cases. Heavy competition, TikTok is playing a huge role right now against their competitors. The metaverse in general might fail. Macroeconomics, things like this might slow down businesses and with a slowdown in business, it might slow down the advertisement side, and the slowdown in e-commerce at the moment. We do see a nice amount of advertisement happening in Meta Platforms solutions.

Then the final one is they’re unable to get over these iOS changes. I do believe most of these bearish cases are more short-term, especially these macroeconomics. Things that might affect for a year or two. But I do believe Meta Platforms continues to be a very heavy player in the advertising world. So one that I enjoy 20% down from pre-pandemic levels, the company has grown users and has entered new adventures as well.

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