Meta Platforms (META) stock is surging Thursday after the parent company of Facebook and Instagram beat top- and bottom-line expectations for its second quarter and issued solid guidance for its third quarter.
In the three months ended June 30, Meta's revenue increased 22.1% year-over-year to $39.1 billion, due in part to a 7% rise in its family daily active people (DAP) users to 3.3 billion. Meta also said its earnings per share (EPS) jumped more than 73% from the year-ago period to $5.16.
"We had a strong quarter, and Meta AI is on track to be the most used artificial intelligent (AI) assistant in the world by the end of the year," said Meta Platforms' CEO Mark Zuckerberg in a statement. "We've released the first frontier-level open source AI model, we continue to see good traction with our Ray-Ban Meta AI glasses, and we're driving good growth across our apps."
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The results topped analysts' expectations. Wall Street was anticipating revenue of $38.3 billion and earnings of $4.73 per share, according to Yahoo Finance.
For the third quarter, Meta anticipates revenue in the range of $38.5 billion to $41 billion. The midpoint of this range, $39.75 billion, came in ahead of analysts' expectations of $39.1 billion.
Meta also raised the low end of its full-year capital expenditures outlook, now anticipating a range of $37 billion to $40 billion from the previous guidance of $35 billion to $40 billion.
In the company's earnings call, Chief Financial Officer Susan Li said Meta expects "expect significant capex growth in 2025" as it invests to support AI research and product development efforts.
Is Meta Platforms stock a buy, sell or hold?
Meta Platforms is one of the best-performing Magnificent 7 stocks this year, up more than 47% on a price basis. Unsurprisingly, the social media giant is one of Wall Street's favorite stocks.
According to S&P Global Market Intelligence, the average analyst target price for META stock is $551.62, representing an upside of more than 6% to current levels. Additionally, the consensus recommendation is Buy, teetering on Strong Buy.
Financial services firm Wedbush is one of the most bullish outfits on META stock with an Outperform rating (equivalent to Buy) and a $600 price target.
"Meta continues to deliver healthy engagement trends," says Wedbush analyst Scott Devitt. "The company has a number of drivers of sustainable growth in place, including continued adoption of Advantage+ campaigns and improving monetization across Reels and messaging ads."
The analyst adds that the communication services stock's "risk/reward is attractive given the improved growth trajectory in the second half, broadly healthy digital advertising trends, and optionality related to future AI monetization."
Related Content
-
Trump's Immigration Policies and the Price of Home Healthcare: First 100 DaysPresident Trump's immigration policies may wallop your pocketbook if you rely on a home healthcare aide.
-
Stock Market Today: Stocks Extend a Quiet Winning StreakThe S&P 500 Index could actually close April with a monthly gain, which would be an extraordinary sign of market resilience.
-
Stock Market Today: Stocks Extend a Quiet Winning Streak
The S&P 500 Index could actually close April with a monthly gain, which would be an extraordinary sign of market resilience.
-
How Trump's First 100 Days Have Impacted Your PortfolioPresident Trump's first 100 days in office have been busy, with a flurry of executive orders sparking volatility in the stock and bond markets.
-
Is It Still Worth It to Gift Savings Bonds?Kiplinger editor explores if it's still a good idea to get savings bonds as gifts for children, looking at their returns and usability.
-
Don't Veer Off Course at the First Sign of a Squall in the MarketsWhen markets go nuts and investor sentiment drops, you can keep your sanity by trusting in and sticking with your long-term plan.
-
How Business Owners Can Prepare for a Terminal DiagnosisThe most important thing is readiness, whether the owner faces a life-changing diagnosis or an employee does.
-
Advisers, Take Note: How 2025 Social Security Changes May Impact Your ClientsWhat financial advisers might need to know to help their clients navigate Social Security in 2025.
-
Stock Market Today: Have We Seen the Bottom for Stocks?Solid first-quarter earnings suggest fundamentals remain solid, and recent price action is encouraging too.
-
Social Security Is Taxable, But There Are WorkaroundsIf you're strategic about your retirement account withdrawals, you can potentially minimize the taxes you'll pay on your Social Security benefits.
