Meta Platforms Inc. META is set to acquire a 5% stake in Essilorluxottica ESLOY, a move that has caught the attention of financial expert Jim Cramer. He believes this deal could be a game-changer for Meta’s future in the wearable tech space.
What Happened: Cramer, host of CNBC’s “Mad Money,” expressed his views on “Squawk Street” on Thursday about the future of Meta Platforms in the wearable tech industry. The company’s stock saw a rise following the news of the potential investment in EssilorLuxottica.
The deal with EssilorLuxottica, the manufacturer of Ray-Ban smart glasses, is seen as a significant development by Cramer. He highlighted the intense production at the company’s Italian factory and the potential for “instant AI” use cases with the smart glasses.
The investment in EssilorLuxottica, valued at approximately 4.5 billion euros ($5 billion), is expected to further strengthen the partnership between the two companies. The Ray-Ban Meta smart glasses, launched last year, have exceeded sales expectations, leading Meta to consider developing more devices in collaboration with EssilorLuxottica.
The third generation of Ray-Ban Meta glasses, anticipated to feature a small screen display, is slated for release during the 2025 holiday season. The popularity of the Ray-Ban brand is crucial for the success of wearable tech, and the partnership with EssilorLuxottica, which also owns LensCrafters, will facilitate the introduction of the Ray-Ban Meta to users requiring prescription lenses.
Why It Matters: Meta’s strategic investment in EssilorLuxottica comes at a crucial time. The wearable tech market is becoming increasingly competitive. Recently, Solos announced its new AirGo Vision smart glasses, powered by OpenAI‘s ChatGPT technology, which could pose a significant challenge to Meta’s offerings.
Additionally, Apple Inc. AAPL is reportedly developing its own AR smart glasses, although these may not hit the market until 2027. This gives Meta a potential head start in establishing its dominance in the smart glasses sector.
Moreover, Meta has been enhancing the functionality of its Ray-Ban Meta smart glasses. As of May, users can now share directly to Instagram Stories, adding another layer of integration with Meta’s social media platforms.
Price Action: Meta Platforms Inc. closed at $475.85 on Thursday, marking an increase of 3.00%. In after-hours trading, the stock rose further 0.75%. Year to date, Meta’s stock has appreciated by 37.41%, according to data from Benzinga Pro.
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Photo courtesy: Ray-Ban
This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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