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Meta reported better reports than forecast results, increasing its driving force for leading artificial intelligence, and strengthening spending, except for the US-China trade war and Wall Street fears on economic uncertainty.
The company’s first quarter revenues rose 16% from a year ago to $42.3 billion, breaking its $41.4 billion forecast, the group said late Wednesday. Net profit rose 35% to $16.7 billion, well above the consensus estimate of $13.5 billion. Meta stocks rose more than 6% in pre-market trading on Thursday.
The tech giant is forecasting second quarter revenue. Its ranges between $42.5 billion and $45.5 billion, with the midpoint of that range slightly higher than Wall Street’s $43.8 billion forecast.
“Our business is working very well. I think we are well positioned to navigate the uncertainty of the macroeconomic,” CEO Mark Zuckerberg said in a call with analysts.
This year, Zuckerberg doubled its plans to make Meta an “AI leader” and boosted spending to develop leading open source language models and AI assistants. The company has also improved the content recommended on users’ Facebook and Instagram feeds, as well as targeting its ads, which executives say is already rewarded.
Meta’s total costs in 2025 ranged from $113 billion to $118 billion, down from previous outlooks to just $114 billion.
Bumper’s results appeared to ease investors’ concerns that the economic uncertainty associated with US President Donald Trump’s tariff policy could significantly knock Meta’s advertising business and Zuckerberg’s AI ambitions. META generates around 10% of its revenue from China-based marketers who have recently curtailed spending.
Meta’s chief financial officer Susan Lee acknowledged that the company experienced “reducing US spending from Asia-based e-commerce exporters” and declining revenues from China-based advertisers in the gaming sector.
On Wednesday, Meta raised its annual capital expenditure forecast from $640 billion to $720 billion to $620 billion to $650 billion. We have supported “additional data center investments” and “expected increase in infrastructure hardware” to support AI push. Li pointed out the “uncertainty” about the ongoing trade debate as the driving force for these potential costs increased.
The results come a day after a small rival SNAP refused to share second quarter financial guidance on revenue. SNAP shares fell 12.4% on Wednesday.
Meta has made some recent AI announcements as he races with rivals such as Open, Elon Musk’s Zai and Microsoft to dominate in the field of generator AI.
In early April, Meta released the latest iteration of the open source AI model, Llama 4, but on Tuesday launched a standalone AI assistant app that rivals Openai’s ChatGPT app.
Meta also took a step towards becoming a cloud provider on Tuesday, and in a move welcomed by analysts, unveiling the Llama API, a developer platform for building on the Llama model.
In an appeal with analysts, Zuckerberg said there is a “big” opportunity to monetize its assistant, meta AI, by displaying product recommendations and ads and providing premium services for more complex tasks. However, he added that the company will first concentrate on scaling for at least another year.
Zuckerberg said another main focus is developing AI agents to help companies responsible for customer service and sales, such as the WhatsApp messaging platform, and to help ongoing development of “AI devices” such as AI glasses.
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Meta’s CEO has visited the White House several times this year to improve relations with lawmakers, overtured Trump to help lawmakers surround the AI industry.
Meta also fights legal challenges from the US Federal Trade Commission, claiming the company maintains its illegal monopoly. Earlier this year, Zuckerberg failed to negotiate a settlement on a bid to avoid going to court.
Li also focused on European regulatory risks. She warned that the decision by the European Commission that the “consent or pay” model of EU digital market law could collapse as “a significant impact on European businesses and revenues.” Under the consent or payroll model, users must either consent to the processing of their personal data or pay a monthly subscription fee.
