META PLATFORMS, INC.

Recommendation history

• Q1 2026BuyMeta delivered a strong Q1: revenue was $56.3B, up 33%, with a 41% operating margin, while ad impressions rose 19% and pricing 12%. The core ads engine remains compelling and AI is improving recommendations, ad conversion, and Business AI usage, supporting a buy despite a major risk: 2026 capex rose to $125–145B, $107B of new contractual commitments were added, and management still lacks precise ROIC or 2027 spending visibility.
• Q4 2025HoldMeta’s core advertising engine remains strong—Q4 worldwide impressions rose 18% year over year, Reels time increased more than 30%, and value-weighted conversions grew faster than impressions—but the investment burden is rising sharply. Management offered no 2026 revenue or margin target, expects compensation to grow faster than headcount, and said operating profit growth will be lumpy as AI infrastructure and talent spending expand; the upside is attractive, but visibility is not sufficient for a clean buy.
• Q3 2025BuyBuy: Meta delivered 26% Q3 revenue growth to $51.2 billion with a 40% operating margin, while ad impressions rose 14% and pricing increased 10%. The core advertising engine remains exceptionally strong, but the investment case now depends on whether materially higher 2026 infrastructure spending converts into durable AI-driven revenue and earnings; management provided no quantified capex, margin, or free-cash-flow targets.
• Q4 2024HoldHold. Meta’s core ad business remains healthy, with capacity constraints expected to ease in the first half of 2025 and a three-point Q1 reported-revenue headwind from FX, but the call reinforced a high-investment, uncertain AI cycle. Reality Labs operating losses are expected to increase again in 2025, with roughly half of investment directed to wearables, while DeepSeek may improve AI efficiency but has not changed Meta’s commitment to heavy infrastructure spending.
• Q4 2023BuyBuy: Meta delivered Q4 revenue of $40.1 billion, up 25%, with a 41% operating margin and $5.33 diluted EPS, while Q1 2024 revenue guidance of $34.5-$37.0 billion supports continued momentum. The core advertising engine is strong, but the investment case now depends on whether AI monetization eventually offsets sharply higher infrastructure spending, $30-$37 billion of 2024 capex, and a meaningfully larger Reality Labs loss.
• Q2 2023BuyBuy: Meta delivered a strong core quarter with $32.0B revenue (+11%), $9.4B operating income and a 29% margin, while AI-driven recommendations, Reels and Advantage+ are improving engagement and ad performance. The tension is that Q3 revenue guidance of $32.0B-$34.5B benefits from easy comparisons and FX, while AI infrastructure spending is accelerating and Reality Labs losses are expected to increase meaningfully in 2024.
• Q1 2023BuyBUY: Meta delivered Q1 revenue of $28.6B (+3% reported, +6% constant currency), a 25% operating margin, and 40% Family of Apps operating margin while reducing headcount 11% sequentially. Engagement, AI-driven ranking, and advertiser performance are improving, with Reels expected to become revenue-neutral by year-end or early 2024; the main tension is substantial ongoing AI and Reality Labs spending alongside regulatory and macro uncertainty.