Key Highlights
- META shares declined approximately 8% during after-hours sessions following quarterly results
- First quarter earnings per share reached $10.44 with revenue totaling $56.3 billion, surpassing analyst projections
- Capital expenditure outlook for 2026 increased to $125B–$145B range, elevated from prior $115B–$135B guidance, driven by component price increases
- Daily active people across Meta’s family of applications grew 4% annually to 3.56 billion
- Company recently revealed workforce reduction plans affecting 8,000 employees, representing roughly 10% of total staff
Meta Platforms delivered impressive first-quarter results, yet investor attention quickly shifted to future spending commitments and their substantial financial implications.
First quarter earnings per share reached $10.44, significantly exceeding Wall Street’s projection of $8.15. Revenue totaled $56.3 billion, surpassing the consensus estimate of $55.5 billion. When accounting for an $8 billion one-time tax benefit, however, EPS adjusts to $7.31.
The positive results failed to prevent a selloff. META shares declined approximately 8% in after-hours trading following the company’s announcement of increased 2026 capital expenditure projections.
Meta currently anticipates 2026 capex will range between $125 billion and $145 billion, representing an increase from the previously communicated range of $115 billion to $135 billion. The company attributed this adjustment to elevated component pricing and expanded data center infrastructure requirements.
Total full-year expenses for 2026 are projected to hold steady within a range of $162 billion to $169 billion.
As a reference point, Meta’s complete-year 2025 costs totaled $117.7 billion, with capital expenditure hitting $72.2 billion — representing a substantial increase compared to previous fiscal periods.
Second quarter revenue guidance was established at $58 billion to $61 billion.
Major Technology Companies’ AI Investments Draw Market Scrutiny
Meta released earnings alongside several other tech giants this week. Alphabet, Microsoft, and Amazon all shared their quarterly performance during the same period. These three companies demonstrated more tangible returns from their AI investments, helping their stock performance remain more stable with investors.
The combined AI expenditures from these four technology leaders are projected to exceed $650 billion during the current year. This substantial figure has created market uncertainty, with analysts questioning the timeline and likelihood of returns matching the investment levels.
Lee Sustar from Forrester highlighted continuing concerns “about the sustainability of the AI boom,” referencing elevated costs alongside limited demonstrated returns thus far.
User Base Expands Annually While Sequential Growth Moderates
Regarding user metrics, Meta’s daily active people measurement hit 3.56 billion as of March, representing a 4% increase compared to the same period last year.
This figure showed a modest decline from 3.58 billion in the fourth quarter, which Meta explained was due to internet connectivity disruptions in Iran and WhatsApp access restrictions in Russia.
Advertisement impressions throughout Meta’s application portfolio increased 19% year-over-year during the first quarter, while average price per advertisement climbed 12%. Both metrics showed acceleration relative to fourth quarter growth rates.
Employee headcount reached 77,986 as of March 31.
During the previous week, Meta disclosed plans to reduce its workforce by 8,000 employees — representing approximately 10% of total staff — while eliminating 6,000 unfilled positions. The company characterized these reductions as part of an ongoing efficiency initiative and necessary to “offset the other investments we’re making.”
Meta concluded regular trading on April 29 at $669.12, before declining to approximately $613 during pre-market activity following the earnings announcement.
