Instagram time spent rose double digits on AI recommendations. The same algorithms face addiction lawsuits from over two dozen states and a privacy backlash over a new image-generation feature.
Meta said global time spent on Instagram rose by double digits in the second quarter, driven by AI-powered recommendations for feeds and Reels. CEO Mark Zuckerberg told analysts on the company's earnings call Wednesday that the improvements boosted sessions by 15 basis points, with particular strength in reshares and time spent.
Recommendations are trained by feeding every public Reel and post to a large language model, which analyzes topics and tone. Zuckerberg called that “a key building block toward greater personalization.” The company plans to extend the same approach to more surfaces on Facebook.
The same algorithms are at the center of a growing legal threat. More than two dozen states have sued Meta, alleging its products are designed to be addictive to teenagers and children. The company disclosed $2.40 billion in charges related to legal proceedings during the quarter.
A separate privacy controversy erupted in early July, when Meta launched Muse Image. The feature let users create AI-generated images from photos on public Instagram accounts of people over 18. By default, eligible accounts were included without prior notice. The backlash forced Meta to shut down the generation function in less than a week.
Users could prevent Meta from accessing visual content by switching off a setting in Instagram's Share and Reuse section. There was no similar option for text, comments, or audio.
CFO Susan Li told analysts the company expects continued “scrutiny on youth-related issues in several markets” and has “a number of youth-related trials scheduled for this year.” Those trials could result in financial losses, she said.
For investors, the legal timeline is the key variable. Adverse rulings could force Meta to alter its recommendation algorithms, potentially reducing engagement and advertising revenue. A settlement would remove that uncertainty but could involve significant costs. The $2.40 billion legal charge already on the books suggests the risk is more than abstract.
Meta did not immediately respond to a request for comment on the lawsuits or the Muse Image controversy.
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