“Our current surge in CapEx is largely due to building out our AI infrastructure and we would expect CapEx to come down as a percent of revenue over the long-term.”

In context

“r shrink over the next year. In aggregate, we expect to end 2023 as either roughly the same size or even a slightly smaller organization than we are today. Three of the primary areas we are going to focus on are our AI discovery engine that’s powering Reels and other recommendation experiences, our ads and business messaging platforms and our future vision for the metaverse. The internal indications I have seen suggest we are doing leading work and are on the right track with these investments. So I think that we should keep investing heavily in these areas. As I have shared before, our goal is to grow Family of Apps operating income such that even with our AI infrastructure and Reality Labs investments, we can still meaningfully grow our overall company operating income in the long-term. Our current surge in CapEx is largely due to building out our AI infrastructure and we would expect CapEx to come down as a percent of revenue over the long-term. We expect Reality Labs expenses will increase meaningfully again in 2023, with the biggest drivers of that being the launch of the next generation of our consumer Quest headset and hiring that has been done in 2022, but for which we are going to be paying the first full year of salaries next year. More broadly, beyond 2023, we expect to pace Reality Labs investments to ensure that we can achieve our goal of growing overall company operating income. Our capital allocation philosophy over the long-term is to allocate a portion of the profits generated from the Family of Apps towards these future-focused areas while enabling a greater return of capital to shareholders. Alright. Now I’d like to share some updates on the progress that we are seeing in these product areas. Our AI discovery engi”