Meta’s first quarter saw a positive market response, with management pointing to robust engagement across its platforms and advancements in artificial intelligence as central to the company’s performance. CEO Mark Zuckerberg emphasized that improvements in AI-powered advertising and content recommendations contributed to increased user time spent, while CFO Susan Li noted that the company’s streamlined operations and cost profile helped drive margin expansion.
Is now the time to buy META? Find out in our full research report (it’s free).
Meta (META) Q1 CY2025 Highlights:
- Revenue: $42.31 billion vs analyst estimates of $41.35 billion (16.1% year-on-year growth, 2.3% beat)
- Adjusted EBITDA: $25.6 billion vs analyst estimates of $23.99 billion (60.5% margin, 6.7% beat)
- Revenue Guidance for Q2 CY2025 is $44 billion at the midpoint, roughly in line with what analysts were expecting
- Operating Margin: 41.5%, up from 37.9% in the same quarter last year
- Daily Active People: 3.43 billion, up 190 million year on year
- Market Capitalization: $1.75 trillion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Meta’s Q1 Earnings Call
- Brian Nowak (Morgan Stanley): Asked about Meta’s AI model strategy and user engagement with Meta AI. CEO Mark Zuckerberg detailed the focus on model efficiency and personalization, while CFO Susan Li broke down leading use cases across platforms.
- Eric Sheridan (Goldman Sachs): Inquired about the rationale for launching a standalone Meta AI app and its competitive positioning. Zuckerberg explained the app’s importance for U.S. user acquisition and differentiation in the AI assistant space.
- Justin Post (Bank of America): Queried about guidance assumptions amid e-commerce supply headwinds and the strategic role of increased capital spending. Li cited macro uncertainty and the need for flexible infrastructure to accommodate future growth.
- Doug Anmuth (JPMorgan): Sought clarification on CapEx drivers and the prospect of infrastructure partnerships. Li noted higher hardware costs due to supply chain complexities and confirmed Meta’s preference to fund its proprietary AI training infrastructure.
- Mark Shmulik (Bernstein): Asked about AI’s impact on internal software development and expense outlook cadence. Zuckerberg outlined ongoing progress toward AI coding agents, while Li described refined cost forecasts and persistent investment in strategic priorities.
Catalysts in Upcoming Quarters
In coming quarters, the StockStory team will monitor (1) the pace at which Meta scales and monetizes its AI-powered features and devices, (2) further adoption and engagement growth in emerging products such as Threads and Ray-Ban Meta AI glasses, and (3) regulatory developments in the European Union that may impact user experience and revenue. Execution on AI infrastructure and business messaging will also be critical signposts.
Meta currently trades at $699, up from $547.41 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free).
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