Meta's Reels Push Hits Critical Scale
This article first appeared on GuruFocus. Meta Platforms, Inc. (NASDAQ:META) is now running Instagram as a video first ad business, with more than half of all ads on the platform shown through Reels in 2025, according to data from Sensor Tower. Ads delivered through Reels jumped 35% last year, underscoring how fast short video has moved from a growth experiment to a core revenue engine for Instagram. Users followed that shift. Reels accounted for 46% of time spent on Instagram in the U.S. in 2025, up from 37% a year earlier, while time spent watching Reels on Facebook climbed to 29%. That surge helped keep Instagram growing. Sensor Tower estimates daily active users on the app rose 2% last year, with increased Reels viewing doing most of the work as Meta continues to push users toward video across its platforms. The short video race remains tight. Watch time for Shorts on YouTube was flat in 2025 but still led Instagram and TikTok on mobile, while YouTube's U.S. daily active users grew 3%. TikTok continued to dominate engagement, with users spending an average of 81 minutes per day, compared with 80 minutes on YouTube and 55 minutes on Instagram. Reels taking over Instagram's ad inventory shows Meta's video bet is translating into real dollars, not just time spent. The bigger test in 2026 will be whether Meta can keep ad pricing strong as competition for short video attention intensifies.
