Gary Black
Co-Founder & Portfolio Manager of The Future Fund
Meta's third-quarter advertising and earnings beats, plus its fourth-quarter revenue outlook, should be viewed favorably by investors. Advertising revenue was $63.1B versus $61.8B expected and EPS was $3.83 versus $3.57; fourth-quarter revenue guidance is $73B-$76B versus $73.6B expected. The lower end of 2026 capex guidance rose to $135B, while the $145B upper end stayed unchanged. x.com
Meta should keep moving higher as investors better appreciate the reach of Muse, its new personal AI agent that can shop, pay bills and manage users' lives. At 24x 2026 EPS against expected long-term revenue and EPS growth of 15%, it still looks attractive despite a 30% September gain versus 3% for the Nasdaq 100. Per a Bloomberg Opinion column, Jefferies called Muse a killer product and raised its target to $875, though Amazon has blocked Muse agents from its store. x.com x.com x.com
James A. Engle
podcast
They are spending nearly $8 a share pretax on this thing called Reality Labs, where we hope they will have a success. ... So you're talking about close to 16,000,000,000 to $20,000,000,000 every year spent on new initiatives. Our assessment there is that they get an adequate return, but probably not the kind of returns they've had in the past. traffic.libsyn.com
AlvaMixedMeta's roughly $8 per share in pretax Reality Labs spending creates a substantial earnings burden; the expectation of adequate but lower historical returns offers a qualified case for that investment.Rory O'Driscoll
podcast
But I think as you start to look to '27, that depreciation is going to start hitting in Microsoft and Google and Meta and places like that. ... And to keep the operating income up, you're going to be really pushing on headcount. podcasts.apple.com
AlvaChallengesThe higher capex outlook may weigh on future earnings as depreciation rises, putting pressure on Meta to reduce other costs, including headcount.
FUNDA
Research Platform for Public Equity Investors
Meta is taking North American ad budget share from Google in verticals such as travel, automotive, and financial services. ... This is also reflected in Meta’s earnings, with its North American growth accelerating by 10% this quarter. x.com
AlvaSupportsThe reported gains in North American travel, automotive and financial-services ad budgets support the durability of Meta's advertising strength, with improved algorithms helping it compete in historically weaker verticals.
Jason Calacanis
LAUNCH founder and early-stage startup investor
All this hand-wringing over capex from Facebook, Microsoft, Google and other new entrants is unnecessary. ... And these machines will last a decade, as software gets relentlessly more efficient and we find creative uses for older clusters. ... Earnings will be absurd in the next five years, as companies like Microsoft, Uber, Tesla, Robinhood, and Meta have revenue per employee DOUBLE every 3-4 years. x.com
AlvaSupportsHe argues Meta's capex can produce strong earnings as hardware remains useful for a decade and revenue per employee doubles every three to four years, offering a favorable forecast for returns on the spending.
Lisa Shalett
Chief Investment Officer of Morgan Stanley Wealth Management
As the fire started to heat up on debt, you saw Meta decide, hey, I'm going to do an equity issuance. And it got eaten up. They're testing markets. There's liquidity there. We're going to play this two-step, I think, between the equity and debt markets to fund this now. podtrac.com
AlvaSupportsStrong demand for Meta's equity issuance suggests it can still access capital to fund its investment plans as debt financing tightens, supporting the view that its higher capex outlook is financeable.Bill Ackman
podcast
We acquired Meta after they disappointed people by committing a large amount of money to CapEx, and the same with Microsoft. ... It's an interesting environment when you have a company come out publicly and say, we have enormous demand for our service. Therefore, we have to invest well in excess of what we expected in CapEx just to try to meet the demand from our product, and then the stock price goes down. sphinx.acast.com
AlvaSupportsAckman says he bought Meta after investors reacted negatively to its large capex commitment, treating spending to meet strong demand as an opportunity rather than a reason to dismiss the investment case.
Gary Gensler
Former SEC Chair, Professor of the Practice at MIT Sloan
I think that we will have a deceleration of this AI boom. And then some form of a reversal in the next 18 to 30 months. And the question really to me is a little bit about timing, when, and then how deep it is. And I think the depth of it is going to be all dependent upon all the debt. podtrac.com
AlvaChallengesGensler forecasts an AI boom deceleration and possible reversal within 18 to 30 months, raising the risk that Meta's rising infrastructure capex will face weaker demand before it pays off.
Reuters
Global News Agency
Nvidia and AMD committing $3 billion and $1 billion, respectively, to the offering. tradingview.com
AlvaSupportsReuters reports AMD committed $1B to Meta's equity offering, converting its previously reported interest into firm backing for the AI financing alongside Nvidia.
Bloomberg
Business and Financial Information and News Platform
Meta’s expanded $25 billion share sale drew demand for about five times the available shares as it seeks $98 billion for AI spending, people familiar said x.com
AlvaSupportsBloomberg reports Meta's $25B common-stock sale attracted orders for about five times the shares available, indicating strong investor demand for financing its AI buildout.Gary Gensler
Former SEC Chair, Professor of the Practice at MIT Sloan
You can be positive about the technology and still say our capital markets tends to overfund in an exuberance. ... And I would say this, when you see the metas raising $ 90 billion, when you see the debt issuance, which is very significant. ... You start to worry. That's feeling a little like that 08 off balance sheet craze. podcasts.apple.com
AlvaChallengesGensler sees Meta's large equity raise and heavy AI debt issuance as signs of exuberant overfunding reminiscent of 2008 off-balance-sheet financing, challenging a favorable reading of the capex increase.
Dow Jones
Real-Time Financial News Wire
Meta issued $25 billion of common shares at $625 each — a roughly 1% discount to the closing price of its stock Monday — and $12.5 billion of 6.5% mandatory convertible preferred stock at $50 a share, the company said in a news release and related filing early Tuesday. tradingview.com
AlvaChallengesMeta completed $37.5B in common and mandatory convertible preferred issuance; the preferred's 6.5% dividend adds a concrete financing cost to its AI investment burden.
Meta Platforms, Inc.
Social Technology Company
We expect to invest $135 billion to $145 billion in cash CapEx in 2026 and we expect that investment to grow in 2027.
AlvaChallengesMeta expects cash capex to rise again in 2027 beyond its $135B-$145B 2026 range, extending the investment burden that could offset its strong advertising results.Cliff Sosin
Founder and Portfolio Manager of CAS Investment Partners
And the core business at Meta is personalized TV. ... And they do a far better job of picking the videos to show people next, which should make the content better targeted and more enjoyable. And then, of course, on the ad side, advertisers could make far better designed, far better targeted personalized ads that then meta in turn can target much better. traffic.megaphone.fm
AlvaSupportsSosin argues that cheaper AI can improve Meta's video recommendations and personalized ad creation and targeting, providing a mechanism for sustained advertising gains.Dow Jones
Real-Time Financial News Wire
Meta intends to increase the deployment of Nvidia infrastructure, including Vera Rubin and Vera central processing units for next-generation AI agents, the companies said in a statement. ... Nvidia will invest $3 billion in Meta's planned equity fundraise. tradingview.com
AlvaMixedMeta's expanded Nvidia partnership will increase deployment of Nvidia infrastructure for its AI agents, supporting the buildout, while Nvidia's $3B investment in Meta's equity raise provides financing for that expansion.Reuters
Global News Agency
META - PRICING OF $25 BILLION OF SHARES OF CLASS A COMMON STOCK AT A PUBLIC OFFERING PRICE OF $625 PER SHARE tradingview.com
AlvaChallengesMeta priced the $25B Class A common-stock offering at $625 per share, confirming the financing terms and the potential dilution from the upsized AI funding raise.Dow Jones
Real-Time Financial News Wire
Meta: Common Stock Offering Upsized to $25B From Previously Announced $22.5B >META tradingview.com
AlvaChallengesMeta's increase in the Class A common-stock offering from $22.5B to $25B adds $2.5B of potential dilution as it finances AI expansion.
Hedgie
Financial Markets Newsletter and Commentary
So Meta spent about $148.6 billion buying back its own stock from 2021 through 2025, and now it wants new buyers to hand some of that money back. That’s a rough trade for long-term shareholders. x.com
AlvaChallengesHedgie argues that Meta's planned equity sales reverse the effect of $148.6B of buybacks from 2021 to 2025, shifting the funding burden for AI expansion back onto shareholders.Dow Jones
Real-Time Financial News Wire
[Quoting William Blair analysts: ""However, we expect investors to continue to question the financing and potential for future capital raises.""] [Quoting William Blair analysts: ""We believe that Meta will ultimately produce a profitable AI business and its returns longer-term should help the company diversify, although the path may not be linear"] tradingview.com
AlvaMixedWilliam Blair expects Meta's equity offerings to expand funding flexibility alongside operating cash flow and debt capacity, but says investors may still question further raises; it expects profitable AI returns over a nonlinear path.Dow Jones
Real-Time Financial News Wire
Meta also plans to establish an at-the-market stock offering program of up to $60 billion, potentially beginning in the first quarter of 2027. The program would allow the company to sell shares over time, though Meta said it hasn't finalized the arrangement. tradingview.com
AlvaChallengesMeta's proposed 2027 stock-sale program is up to $60B and has not been finalized, qualifying the earlier report of a planned $60B issuance while keeping potential dilution material.
Walter Bloomberg
Financial News Headlines Aggregator, Not Affiliated with Bloomberg
Meta targets $135B–$145B in 2026 capex, with another $60B stock-sale program planned for 2027. x.com
AlvaChallengesThe reported additional $60B stock-sale program planned for 2027 points to substantial financing needs beyond the newly launched $35B offering and increases potential shareholder dilution.