Meta Platforms (META) stock fell early Thursday after the company announced plans to increase its AI spending, partially as a result of higher input costs, which overshadowed another beat on the top and bottom line for the social media giant.
The company reported first quarter earnings on Wednesday that showed profits beat forecasts, with earnings per share (EPS) tallying $10.44 on revenue of $56.3 billion. Wall Street analysts expected adjusted earnings of $8.15 per share on revenue of $55.5 billion, according to Bloomberg estimates.
Excluding an $8 billion one-time tax benefit, Meta’s earnings per share would’ve come in at $7.31. Revenue in the current quarter is expected to fall in a range of $58 billion to $61 billion.
Investors were also eagerly awaiting an update on Meta’s spending plans in the report, which showed overall company costs are expected to remain steady while its capital expenditures — which are more focused on AI-related investments — are expected to rise.
Meta stock was down over 8% in premarket trading following the results.
Meta said its 2026 capex spending will come in between $125 billion and $145 billion, up from its earlier forecast of $115 billion to $135 billion. Overall expenses are expected to remain the same, reaching a range of $162 billion to $169 billion for the year.
In a statement on Wednesday, the company said its increased capex forecast, “reflects our expectations for higher component pricing this year and, to a lesser extent, additional data center costs to support future year capacity.”
A year ago, the company’s 2025 spending forecasts put total spending in a range of $113 billion to $118 billion, with capital expenditures forecast at $64 billion to $72 billion. Full-year costs in 2025 reached $117.7 billion; its capex spending topped out at $72.2 billion.
Elsewhere in its release, Meta announced a 4% increase in its daily active users across its platforms to 3.56 billion, on average, as of March. This marked a decline compared to the prior quarter, when its daily active people metric stood at 3.58 billion, due to internet disruptions in Iran and a WhatsApp restriction in Russia, the company said.
Ad impressions across its family of apps rose 19% over the prior year while price paid per ad rose 12%. These both marked an acceleration from the annual growth seen in Q4. The company’s headcount stood at 77,986 as of March 31.
Last week, Meta announced plans to cut 8,000 workers — or 10% of its workforce — and take down 6,000 open roles. In a memo announcing these cuts, Meta cited a continued efficiency push and a need to “offset the other investments we’re making.”
