It's good for advertising. For example, Facebook analyzes all of your photos, and realizes there are a high number of images with sailboats.
That means you might have an interest in sailing, travel offers, or outdoor equipment, and Facebook can test that theory, and see if related advertisements have higher conversion rates.
It's also beneficial for user engagement, and by analyzing your photos, Facebook could recommend related groups in your area, or upcoming sailing events.
On the other end, imagine you make cosplay outfits for a living. You want to promote your business. Wouldn't it be efficient if you could only show your advertisement to Instagram or Snapchat users that post a high percentage of cosplay photos? That would result in a much higher click-through rate, and they could charge a higher premium for those targeted advertisements.
Or, what if you run a wallpaper site, where users upload wallpapers? You could automatically categorize and tag those images for users to search. Or, if someone is viewing a wallpaper of a sunset, you might want to show related sunset wallpapers that could interest them. That's pretty powerful. You could upload one million photos, and with a little work have them all nicely arranged in categories.