Meta Analysts Revise Price Target After Q3 Core Ad Strength, Muse Concerns Remain
Key takeaways
- Meta’s earnings miss and hefty AI investment plans have pushed the stock lower, while analysts remain split on whether the growth from Muse and ad performance will justify the higher capex.
- Revenue: $64.6 billion (26% YoY)
- EPS: $3.83 (missed $5.29 consensus)
- Legal expenses: $9.9 billion
What happened
Meta Platforms Inc (NASDAQ: META) reported a strong third‑quarter revenue of $64.6 billion, up 26% year‑on‑year, and beat revenue expectations, but its earnings per share of $3.83 fell short of the $5.29 consensus due to $9.9 billion in legal expenses. The company raised its 2027 capital‑expenditure estimate to $249 billion and confirmed fourth‑quarter revenue guidance of $73–$76 billion, 3% above consensus. Despite the upbeat numbers, shares fell 8.02% to $641.55 in early trading as analysts…
Why it matters
The earnings miss and high legal costs underline Meta’s growing cost base, while the aggressive 2027 capex push signals a heavy investment cycle that could pressure cash flow. The mixed analyst outlooks—some raising targets, others cutting them—reflect divergent views on whether AI‑driven growth will offset the hefty…
Short-term and longer-term
Short-term. In the next few days, watch for Meta’s stock to react to the earnings miss and the revised capex outlook.
Longer-term. Over the coming months, Meta’s ability to generate incremental revenue from its AI‑driven ad platform and Muse will be critical.