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Meta Platforms (NASDAQ: META) stock jumped 12% in premarket trading after reporting second-quarter earnings that blew past analyst expectations. The company posted earnings per share (EPS) of $7.14 on revenue of $47.5 billion. The shares outperformed forecasts of $5.89 EPS and $44.83 billion in revenue. This marks one of Meta’s strongest quarters in recent times, driven largely by advertising performance.
Meta’s core advertising business remained dominant, delivering $46.5 billion in Q2 revenue, beating estimates of $44.07 billion. The company’s ecosystem of apps, including Facebook, Instagram, and WhatsApp, contributed substantially. Improved targeting and early adoption of AI-driven ad solutions also boosted ad delivery efficiency, helping Meta outperform in a competitive digital landscape.
While the metaverse-focused Reality Labs division recorded a $4.5 billion loss. It still performed better than analysts’ projections of a loss of $4.8 billion. Reality Labs continues to be a long-term investment for Meta. The company remains committed to developing immersive VR and AR experiences despite current challenges.
The Mark Zuckerberg-led company issued an optimistic forecast for the third quarter, estimating revenue between $47.5 billion and $50.5 billion. This beats Wall Street’s average estimate of $46.2 billion. It also signals that Meta anticipates continued strong momentum in advertising, AI products, and platform engagement. Analysts have responded positively, with many upgrading their price targets.
CEO Mark Zuckerberg reinforced Meta’s aggressive AI agenda, citing the formation of the Meta Superintelligence Lab and a wave of high-profile AI hires. These include former GitHub CEO Nat Friedman, Scale AI’s Alexandr Wang, and ex-Apple AI leader Ruoming Pang. Meta is building massive AI infrastructure, such as the Hyperion data center, to support AI training and deployment at scale.
In his statement, the CEO also introduced the company’s long-term vision of ‘personal superintelligence.’ This concept involves developing smart, personalized AI assistants to enhance creativity, productivity, and social interactions. The goal is to embed AI deeper into daily life across Meta’s platforms, making it indispensable for users.
CFO Susan Li warned of increased expenses in 2026, mainly due to hiring and infrastructure spending. However, investors seem unbothered, viewing these investments as essential to maintaining Meta’s leadership in generative AI and advertising.
Meta stock’s price hike signaled renewed investor confidence driven by AI-fueled forward outlook. Crucially, management's substantial investment, particularly in generative AI and Llama 2, resonated strongly with the market. The stock also remains a key candidate for stock split in coming months. Consequently, the market response reflects a re-evaluation of the company's growth trajectory and a clear path toward enhanced profitability.
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