Meta's Potential 5% Acquisition In Ray-Ban Maker Applauded By Financial Expert Jim Cramer
Meta Platforms Inc. (NASDAQ: META) is set to acquire a 5% stake in Essilorluxottica (OTC: ESLOY), a move applauded by financial expert Jim Cramer. This acquisition has significant implications for Meta's future in the wearable tech industry.
Details of the Acquisition
Jim Cramer, host of CNBC’s “Mad Money,” discussed Meta Platforms' future in the wearable tech industry on “Squawk Street”. Following the news of the potential investment in EssilorLuxottica, Meta's stock experienced an increase. The deal with EssilorLuxottica, the manufacturer of Ray-Ban smart glasses, is considered a major development by Cramer. He highlighted the advanced production capabilities at the company’s Italian factory and the potential for utilizing "instant AI" features with the smart glasses.
All eyes are on $META, with reports indicating a 5% stake acquisition in Ray-Ban parent EssilorLuxottica. Cramer shared his insights on the future of the company in wearables on @jimcramer's #MadDash.
The investment in EssilorLuxottica, valued at around 4.5 billion euros ($5 billion), is expected to further solidify the partnership between the two companies. The successful sales performance of the Ray-Ban Meta smart glasses, launched last year, has exceeded expectations, prompting Meta to explore additional device developments in collaboration with EssilorLuxottica.
Importance of the Acquisition
Meta’s strategic move to invest in EssilorLuxottica comes at a crucial time as the wearable tech market faces increasing competition. The emergence of Solos' AirGo Vision smart glasses, powered by OpenAI's ChatGPT technology, poses a potential challenge to Meta's offerings. Additionally, Apple Inc. (NASDAQ: AAPL) is reportedly working on its AR smart glasses, potentially entering the market by 2027, providing Meta with an opportunity to establish its dominance in the smart glasses sector.
Meta has been enhancing the features of its Ray-Ban Meta smart glasses, including the ability for users to share directly to Instagram Stories, further integrating with Meta’s social media platforms.
Financial Performance
Meta Platforms Inc. closed at $475.85 on Thursday, reflecting a 3.00% increase. In after-hours trading, the stock continued to rise by 0.75%. Year to date, Meta’s stock has appreciated by 37.41% based on data from Benzinga Pro.
Future Outlook
The third generation of Ray-Ban Meta glasses, expected to include a small screen display, is set for release during the 2025 holiday season. The success of the Ray-Ban brand is crucial for the adoption of wearable tech, and the collaboration with EssilorLuxottica, the owner of LensCrafters, will facilitate the introduction of Ray-Ban Meta to users in need of prescription lenses.
Meta's investment in EssilorLuxottica signals a strategic move in the competitive wearable tech market, positioning the company for future growth and innovation.
