Meta Set to Report Earnings Amid AI Investments and Stock Performance

MENLO PARK, California — Meta Platforms Inc. is scheduled to release its third-quarter earnings report on Wednesday after the stock market closes. Analysts are particularly interested in insights regarding the company’s investments in artificial intelligence (AI) as it navigates a changing tech landscape.

In preparation for its earnings call, Wall Street anticipates that Meta will report revenues of $49.4 billion for the third quarter, reflecting a 22% year-over-year increase. For the full year, the company’s overall sales are projected to climb by 19% to approximately $196.2 billion.

CEO Mark Zuckerberg previously indicated that Meta’s shift toward AI would result in significant year-over-year expense growth, with expectations that expenses for 2025 could reach between $114 billion and $118 billion.

Recently, Meta has made headlines with its AI initiatives, including the launch of the Meta AI app and a new line of smart glasses in collaboration with Ray-Ban at its Connect event. The glasses have begun to attract attention since their release in late September, with reports of strong initial sales.

Analysts from multiple firms rendered optimistic assessments ahead of earnings. For instance, CFRA stated that they expect Meta to continue outpacing broader digital advertising markets due to its ongoing investments in AI technologies. They predict a growth rate of about 21% to 22% for the third quarter.

Meanwhile, in a move to bolster its AI division, Meta has reshuffled leadership, appointing Vishal Shah to lead product development for its AI unit. The Reality Labs sector, responsible for virtual and augmented reality innovations, is expected to report an operating loss alongside a modest revenue contribution.

Market analysts will be keen to assess how these AI investments manifest in revenue performance, particularly given the heightened competition from other tech giants in the sector.

Investors will also be monitoring any updates regarding Meta’s strategy in the Metaverse, as the tech giant looks to balance its focus between emerging technologies and traditional advertising revenue streams.

As the earnings release approaches, analysts predict the company will provide insights into its advertising revenue, which remains the backbone of its earnings. Historical performance has shown that Meta often surpasses Wall Street estimates, leading to upward trends in stock prices in the days that follow.