Meta Stock Price Surges 5% After Earnings Report 

Meta Earnings Beat Q1 Estimates and Offer Promising Q2 Outlook Despite Ad Slowdown Because of Trump’s Tariffs 

The Meta stock price increased by more than 5% after the Q1 Meta earnings report was shared. For Q1, the Meta earnings report showed earnings per share (EPS) of $6.43 and revenue of $42.3 billion. 

The expectation was that Meta earnings for Q1 would be $42 billion and EPS would be $5.25. In comparison, Q1 2024 numbers were EPS of $4.72 and revenue of $36.4 billion. Meta earnings for Q2 are anticipated to be between $42.5- $45.5 billion, while Wall Street expects it to be $44 billion. 

While the Meta stock price is down more than 7% since the start of 2025, it has overall gained 25% in the past 12 months. Ad sales have remained strong despite concerns related to Trump’s tariffs, and the company has reported better revenue than expected. This is in contrast to most organizations, which have taken a hit in earnings due to tariffs. 

Meta’s finance chief, Susan Li, has said that some reduced ad spend is expected from Asia’s e-commerce exporters, but despite this, the company is well-positioned to navigate macroeconomic uncertainty. Meta is working to mitigate the risks its supply chain faces because of the new tariffs. A slowdown in spending from Chinese retailers like Temu and Shein could reflect in Q2 Meta earnings. 

The social media giant also raised its full-year capital expenditure to between $64 billion and $72 billion. The increase is because of additional data center investment to support Meta’s AI efforts and will also cover an increase in the expected cost of infrastructure hardware. 

Operating losses of Meta’s Reality Labs continue to grow at an alarming rate. The billions of dollars lost in Reality Labs and genAI are taking the shine off its overall business. The monopoly case is also a concern, and depending on the outcome, Meta could break up and lose some of the scale advantage it has built over time. 

Meta Stock Price Future Estimate

Experts say the Meta stock price is undervalued and depends largely on whether Meta can improve ad monetization and address investor concerns about the return on investment (ROI) in its AI language models. Meta’s ad demand is so far unaffected, but it may face headwinds in Q2 that could significantly impact the Meta stock price. Advertising sales from North America and Europe will grow steadily, but increasingly affluent and growing middle classes in the rest of the world will allow Meta to improve ad monetization, raising its top line. 

The antitrust cases against Meta are materially weaker against Alphabet, but key analysts refrain from making predictions about the outcome and whether those will greatly affect the Meta stock price. Regardless, the key valuation driver of the Meta stock price will be the genAI monetization, and any clear progress in AI will take the Meta stock price to new highs. 

Conclusion

The latest Meta earnings report reaffirms the company’s core strength in advertising and its successful pivot toward AI, as evidenced by better-than-expected Q1 results and an ambitious capital expenditure (capex) increase to $64–$72 billion for 2025. 

The stock’s 5% surge post-earnings reflects investor confidence in Meta’s ability to navigate tariff-related ad slowdowns and capitalize on global ad demand. While Reality Labs continues to generate significant losses, Zuckerberg’s long-term vision for AI-driven devices and augmented reality wearables may ultimately unlock new revenue streams, even if the near-term return on investment (ROI) remains uncertain. 

Regulatory risks, including compliance with the EU Digital Markets Act and U.S. antitrust scrutiny, pose potential operational challenges. However, Meta’s diversified Family of Apps and strong user growth provide a buffer against legal disruptions. Looking ahead, the key driver for the Meta stock price will be sustainable ad monetization and measurable progress in genAI products, which could propel the stock to new highs if executed effectively.

About the Author: Sarah Zimmerman is a seasoned crypto and Web3 news writer passionate about uncovering the latest developments in the digital asset space. With years of hands-on experience covering blockchain innovations, cryptocurrency trends, and decentralized technologies, she strives to deliver insightful and balanced news that empowers her readers. Her work is dedicated to demystifying complex topics and keeping you informed about the ever-evolving world of technology.