Meta results strong but spending plans weigh on shares, says UBS Proactive uses images sourced from Shutterstock
Meta Platforms Inc (NASDAQ:META, XETRA:FB2A, SIX:FB) saw its strong first-quarter performance overshadowed by a sharp increase in spending plans, according to UBS.
The US technology group beat expectations on both revenue and earnings in the three months to March, with analysts highlighting a “clear beat” on revenue and EPS.
However, UBS said the market reaction was driven by guidance rather than the headline numbers.
Meta raised its 2026 capital expenditure outlook to $125 billion-$145 billion, up from $115 billion-$135 billion previously, pointing to further heavy investment in artificial intelligence infrastructure.
Second-quarter revenue guidance of $58 billion-$61 billion was described as “in line with Street at midpoint”, suggesting limited near-term upside despite the strong first-quarter delivery.
The increase in capex guidance and in-line guidance were sees as negatives that “offset” the positivity from top and bottom line beat, UBS said.
Investor focus is now shifting towards execution and returns on that spending, the analysts explained.
“Investors will be keenly focused on product development (business chatbot / Meta AI) data points as well as rationale for CapEx budget increase,” it added.
The response underlines a broader trend across big tech, where rising AI investment is supporting long-term growth expectations but raising questions over near-term returns.