Meta Platforms (META) stock fell about 6% in after-hours trading following its first quarter earnings report. The company reported earnings per share (EPS) of $10.44 on revenue of $56.3 billion. Wall Street analysts had expected adjusted earnings of $8.15 per share on revenue of $55.5 billion.
Excluding an $8 billion one-time tax benefit, Meta’s EPS would have been $7.31. Despite the strong revenue growth—analysts estimate it grew more than 30% year-over-year—investors reacted negatively to the company’s increased forecast for capital expenditures.
Meta’s 2026 capital expenditures forecast is now between $125 billion and $145 billion. Overall expenses for the year are expected to reach a range of $162 billion to $169 billion. The company also announced a 4% increase in daily active users to 3.56 billion as of March.
The decision to cut 8,000 workers, or 10% of its workforce, aims to offset these investments in AI spending. Analysts from Oppenheimer noted that while Meta is likely to report strong revenue growth, higher compute costs for its AI models could limit profit upside.
All 20 analysts tracked by Visible Alpha rate Meta stock as a “buy” with an average price target of $865. However, stock volatility remains a concern; Meta’s shares have moved more than 10% following earnings in three of the last four quarters.
As investors process this information, some are already speculating about potential future movements. A significant shift from Tuesday’s close could send shares as high as $715, nearing the peak of the rally that followed the previous earnings report in January.
Meta’s headcount stood at 77,986 as of March 31, and the company continues to navigate a complex landscape of rising costs and increasing competition from platforms like Alphabet’s YouTube.
