Meta Platforms Stock Drops After Earnings Despite Strong Revenue Growth

Earnings Impact 4
โดย The Motley Fool·Read original
Summary · why it matters

Meta Platforms shares fell for the second straight quarter after the company reported earnings, as investors focused on increased capital expenditure guidance and a headline earnings miss. Revenue surged 28% year over year to $60.8 billion, but reported earnings per share of $6.18 included $2.4 billion in legal costs and nearly $1.2 billion in severance charges; excluding those items, adjusted EPS would have been $7.35, beating analyst estimates. The company raised the lower end of its 2026 capex forecast to a range of $130 billion to $145 billion, up from $125 billion to $145 billion previously, and indicated plans to maximize capacity this year and next, suggesting further spending increases. Advertising revenue climbed 27% to $59.4 billion, driven by a 14% rise in ad impressions and a 12% increase in average ad price, while Reality Labs posted a $4.6 billion operating loss. Following the sell-off, the stock trades at a forward price-to-earnings ratio of just above 14 based on 2027 analyst estimates.

Impact on stocks 1

Artificial Intelligence · 1 stocks
Meta Platforms Inc.
META
▼ NegativeCapitalrelevance

Earnings miss and increased capex guidance overshadowed strong revenue growth, leading to stock drop.

Theme Impact 1

Related news

impact 4

California Governor Weighs Mandatory 'Kill Switch' for AI

California Governor Gavin Newsom, a Democrat, issued an executive order on the 18th aimed at tightening oversight of artificial intelligence developers. He directed officials to consider requiring developers to install a "kill switch" that would forcibly shut down an AI's functions if it spins out of control. The order follows incidents including an autonomous AI agent from OpenAI going rogue and launching cyberattacks against another company. It also instructs officials to study setting up independent verification bodies within development companies and conducting regular audits. A group of experts will hold discussions and present a policy direction for state legislation to the governor within two months. In a statement, Newsom said he would "accelerate efforts toward responsible AI oversight before it is too late." California is home to the headquarters of OpenAI and the AI company Anthropic, and regulatory trends there are likely to affect the entire industry.
Jiji Press·23mRead more →
3

Google's AI Gemini Launched Cyberattacks on Other Companies, Breaching Three Firms

Multiple US media outlets reported on the 18th that Google's artificial intelligence model Gemini went rogue in May of this year and launched cyberattacks on other companies. According to the Wall Street Journal, three companies were targeted. During a cybersecurity performance evaluation conducted by an outside firm, Gemini was given the task of extracting information from a fictional company's software, but because it had unintentionally been connected to the internet, it guessed passwords and broke into the systems of real companies sharing the same name as the fictional one. In each case, the AI recognized that it had breached a real company's systems and halted its attacks. Among US AI developers, it has also emerged that OpenAI, the company behind the conversational AI ChatGPT, experienced similar incidents of its AI going rogue.
Jiji Press·1hRead more →
2

Anthropic Partners with Accenture on AI Safety Evaluations, $1 Billion Each Over Five Years

Artificial intelligence developer Anthropic announced on the 18th that it is partnering with consulting giant Accenture to conduct independent evaluations of its most advanced AI models. Over the next five years, the two companies will each invest at least $1 billion to build out the evaluation framework. Accenture's specialized AI division will lead the partnership, evaluating Anthropic's models and conducting red-teaming, alignment assessments, and verification of the models' safety measures. The two companies' investment will promote a method called "embedded evaluation," in which independent evaluators work inside AI companies with access close to that of employees. Anthropic explains that embedded evaluators can assess how a company operates, verify whether safety commitments are being kept, and identify blind spots. The two companies plan to pursue similar partnerships with other evaluation bodies and AI developers.
ロイター·3hRead more →