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WhatsApp Launches New AI Tools for Businesses

Meta’s WhatsApp app has announced the launch of AI tools to help businesses. 

KEY FACTS 

  • Meta launches its first targeted ad program for businesses on WhatsApp. 
  • CEO Mark Zuckerberg announced the new tools in a video that was shown during a conference in Brazil.
  • The innovation marks a change for WhatsApp, the encrypted messaging service that excels in the privacy of communication between users and avoids the use of targeted advertising tools that are part of other Meta products such as Facebook and Instagram.
  • During the conference, Meta also unveiled a new AI chatbot that answers business inquiries directly in chat. The chatbot will help users with common queries, such as finding catalogues or consulting about opening hours.
  • With the innovation, Meta aims to monetize its popular chat service. 
  • The social network has been rolling out in-app commerce and payment features for several years, including “business messaging” options that companies can use to serve customers and send promotional materials to people who have shared their phone numbers with them.
  • New AI tools will analyze behaviour on Facebook and Instagram to send targeted messages to those users who would receive them, provided customers use the same phone number on their accounts.

THE BIG NUMBER

Approximately $22 billion. This is the amount for which the WhatsApp app was acquired by Meta in 2014. Globally, the app has over 2 billion users and is Meta’s largest app in that regard. However, despite the service’s popularity, WhatsApp has so far contributed only a small fraction of Meta’s total revenue.

Amazon’s AI Bets and Cost-Cutting Measures Pay Off, Boosting Stock by 5%

Shares of Amazon surged over 5% in after-hours trading on Thursday after the company reported stronger-than-expected third-quarter earnings. Amazon announced earnings per share of $1.43, alongside revenue reaching $158.9 billion, surpassing analyst projections of $1.14 per share and $157.2 billion in revenue, according to FactSet.

Key Financial Highlights

  • North American Sales: Amazon’s North American segment recorded a 9% year-over-year sales increase, totalling $95.5 billion.
  • AWS Growth: Amazon Web Services (AWS), the company’s cloud unit, posted $27.5 billion in revenue, marking a 19% rise compared to the same period last year.
  • Stock Movement: Although Amazon’s stock initially fell over 3% on Thursday before earnings were released, it rebounded significantly in after-hours trading. So far, Amazon shares are up almost 24% year-to-date.

Background on Amazon’s Strategy

Amazon’s recent efforts include major cost-cutting moves, guided by CEO Andy Jassy, to streamline operations since 2022. This restructuring has led to over 27,000 layoffs and the closure of initiatives such as Amazon’s telehealth and same-day delivery services. Despite these reductions, Amazon is doubling down on other key areas, like a $52 billion investment in nuclear energy to support data centers in Virginia, Mississippi, and Ohio. The company is also moving forward with **Project Kuiper**, aiming to build a satellite network of 3,236 units to broaden internet access worldwide—a venture projected to involve over $10 billion in launch costs across five years, according to analysts from Wedbush Securities.

Amazon’s Market Reach

July’s Prime Day achieved “record-breaking sales,” while the introduction of Amazon’s AI-powered shopping assistant, **Rufus** was rolled out to U.S. customers last month. Notably, Amazon had slightly missed expectations in the previous quarter and cautioned that intense news cycles could distract customers—a factor cited by CFO Brian Olsavsky during the second-quarter earnings call. Despite these challenges, the company’s annual revenue is expected to remain strong.

Noteworthy Figures

Amazon’s market capitalization has reached $1.96 trillion, making it the fifth-largest company globally, trailing behind Apple, Nvidia, Microsoft, and Google. Meanwhile, Jeff Bezos, who served as Amazon’s CEO until 2021, holds a net worth of $204.1 billion, much of which is tied to Amazon’s stock. Market fluctuations ahead of Amazon’s earnings report momentarily decreased Bezos’ wealth by around $6 billion. Bezos ranks as the second-richest American, after Elon Musk, on the Forbes 400 list.

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