After Google’s strong report last week, there is some optimism that Meta will overachieve as well although as Goldman warned in our preview, caution seems to be prevalent. There is certainly some pressure on the advertising business to keep chugging along given how much Zuckerberg is spending on AI these days.
Which brings us to CapEx: as Bloomberg's Kurt Wagner writes, he will be looking for any changes to Meta’s projected range for capital expenditures for the year, which is currently $64 billion to $72 billion. The company increased its CapEx range in April, citing the global trade disputes and its AI effort. Since then we’ve seen Zuckerberg invest more than $14 billion in Scale AI, throw nine-figure compensation packages at AI researchers, and talk about building multi-gigawatt data centers. It wouldn't be at all surprising if this number moves higher, but it was ridiculously high to begin with.
And sure enough it did, because moments ago META reported results that blew away expectations for the second quarter and gave a stronger-than-expected third-quarter revenue and full-year capex forecast, a sign the core advertising business is still growing quickly enough to support aggressive spending on artificial intelligence. Here is the breakdown:
Here is a visual recap of the results:
Other metrics:
According to META, its "family daily active people" metrics, whatever that is, hit a new record high of 3.48 billion per day, up 6% YoY, and beating estimate 3.42 billion. Because literally half the world is on Facebook every day, sure it is.
Outlook:
And a word of caution in the CFO commentary as we look ahead to the holiday quarter:
“While we are not providing an outlook for fourth quarter revenue, we would expect our year-over-year growth rate in the fourth quarter of 2025 to be slower than the third quarter as we lap a period of stronger growth in the fourth quarter of 2024.”
That however was hardly relevant to investors who saw the numbers and just couldn't wait to get in, and the result is that the stock is now trading up10% to $770, a new all time high.
Investor presentation below