Meta stock snaps back after hours as AI bet gets even bigger
Meta Platforms lit the fuse after the close. The company beat Q4 expectations, then doubled down on a massive AI buildout. Shares swung hard all day, then jumped more than 4 percent after hours to near 696. Investors asked for proof. Meta handed them numbers, cash flow, and a louder plan.
Earnings beat, louder guidance
Meta posted Q4 EPS of 8.88, ahead of about 8.21 expected. Revenue reached 59.89 billion, also above estimates. EPS rose 11 percent year over year. Revenue rose 24 percent. The core ad engine is doing the heavy lifting, with better pricing, stronger conversion, and steadier engagement across apps.
The stock finished the regular session around 668.73, down about 0.9 percent, after a volatile ride. The intraday range ran from 637.90 to 700.08. The after-hours pop followed the release. Traders had braced for a move near 6 percent, so today’s reaction fits the setup.
Guidance stole the show. Management projected 2026 capital spending of 115 to 135 billion, focused on AI data centers, chips, and model training capacity. At the same time, the company said it still expects operating income to be higher in 2026 than 2025. That pairing, heavier spend and higher profits, is the crux of the bull case.
Meta sees 115 to 135 billion of 2026 CapEx, and still targets higher operating income next year.
Can AI scale without crushing margins
This is the key debate. AI training needs huge upfront investment. Inference at scale needs cheaper, faster chips and smarter software. Management’s message is clear. Spend now, widen the moat, then harvest through better ads, new tools for businesses, and next-gen consumer features.
The near-term test is margin resilience. Costs will rise as new data centers go live. To offset that, the ad machine must keep pushing yield. Advantage+ automation, creative tools, and improved measurement continue to lift return on ad spend for marketers. If those gains hold, Meta can pass higher compute costs through stronger pricing and volume.
The other lever is platform time. Reels, messaging ads, and video commerce drive more sessions, which fuels impressions. Threads and AI assistants add fresh surfaces. Every minute spent in the apps is more signal for models, and more inventory for advertisers.
The tape, the levels, the next move
Today’s tape was a roller coaster. The stock whipsawed between 637.90 and 700.08 before settling near 668.73. After hours, buyers pushed it back toward 696. That puts price near the 200-day area, with 700 acting like a magnet. Earlier this week, shares reclaimed the 50-day moving average near 642, a key momentum reset.
If bulls can hold the 660s, a clean break above 700 would target prior highs. Failure to stick the after-hours move would shift focus to the 650 zone. Liquidity is deep, but options positioning can amplify swings into the open.
Watch 700 as resistance and 650 to 660 as support. Use smaller position sizes into tomorrow’s open, volatility is elevated.
The wider economy gets a piece
Meta’s CapEx plan means real money for the AI supply chain. Chipmakers, power systems, fiber, cooling, and construction will all see orders. Data center buildouts lift local labor demand and utility planning, especially in regions with cheap land and power. The grid becomes part of the story, as power contracts and efficiency gains matter more.
On the demand side, ad growth signals a steady consumer. Brands are spending, and performance marketers are leaning in where attribution is stronger. That is a tailwind for digital ad ecosystems and a vote of confidence in year-ahead retail activity.
Investment view, what matters now
The investment case now turns on execution speed. Meta must turn record AI spend into near-term revenue, while keeping margins healthy. The path runs through ads, tools for businesses, and paid features that improve utility and lock-in.
Here is the simple checklist from tonight’s prints:
- Ad pricing and impression growth stay firm through Q1.
- AI features lower content and support costs per user.
- Data center ramps proceed on time and on budget.
- Operating income guidance holds, even as CapEx climbs.
Investors should expect noise. Model training cycles can spike costs before benefits show up. New surfaces like Threads need time to scale. Regulation, energy costs, and component supply can pinch plans. The flip side looks powerful. If ad growth holds near the current pace, and compute costs per query fall, operating leverage returns quickly.
Execution risk is real. Big CapEx before monetization can compress margins if ad trends cool.
Bottom line
Meta cleared the earnings bar and raised the stakes on AI. The company is telling the market it can spend more, and still grow profit next year. The stock is testing 700 again, with momentum back in its corner. The next few quarters will answer the big question, can Meta turn its AI build into cash flow fast enough to keep margins strong. If the answer is yes, tonight’s pop could be the start of a longer move. If not, the 650s will be back in play. For now, the ball is in Meta’s court, and the market is listening. 👀
