Meta results beat expectations, lifts AI spending
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The news: Meta reported first-quarter sales of USD42.31 billion ($66.2 billion), beating Wall Street estimates of USD41.4 billion, with earnings per share of USD6.43 versus USD5.28 expected, according to LSEG data.
The company also raised its 2025 capital expenditure forecast to USD64 billion to USD72 billion, up from USD60 billion to USD65 billion, citing “additional data center investments to support our artificial intelligence efforts as well as an increase in the expected cost of infrastructure hardware.”
The context: Meta is investing heavily in AI amid competition from OpenAI and Google and is fighting a major FTC antitrust case seeking to unwind its acquisitions of Instagram and WhatsApp. The results defied fears of a tariff-related advertising slowdown, and came after Meta’s Llama 4 AI models released earlier this month underwhelmed.
The numbers: Advertising revenue came in at USD41.39 billion, ahead of projections of USD40.44 billion. Net income rose to USD16.64 billion, up from USD12.37 billion a year earlier.
The company said second-quarter revenue will be in the range of USD42.5 billion to USD45.5 billion, in line with analysts’ expectations.
Meta lowered its total expense forecast to USD113 billion to USD118 billion, from USD114 billion to USD119 billion. Reality Labs posted an operating loss of USD4.2 billion. It warned a European Commission ruling could have “a significant impact” on its European revenue as soon as Q3. The EC decided Meta’s no-ads subscription service for European users is not in compliance with its regulations.
The sources: Meta release , CNBC
