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Meta Platforms Inc’s strong first-quarter results were overshadowed by a sharp increase in its spending plans, according to UBS.
The US technology group beat expectations on both revenue and earnings in the three months to March, with analysts pointing to a clear beat on revenue and EPS.
UBS said the market response was driven more by Meta’s guidance than by the headline first-quarter numbers.
Meta raised its 2026 capital expenditure outlook to $125 billion-$145 billion, up from $115 billion-$135 billion previously. UBS linked the increase to further heavy investment in artificial intelligence infrastructure.
UBS also highlighted Meta’s second-quarter revenue guidance of $58 billion-$61 billion, describing it as in line with Street estimates at the midpoint. That suggested limited near-term upside despite the strong first-quarter delivery.
UBS characterized the higher capex guidance and the in-line revenue guidance as negatives that outweighed the positivity from the top- and bottom-line beat.
With the spending outlook now in focus, UBS said investor attention is shifting toward execution and the returns Meta can generate from its increased investment.
Investors are expected to focus on product development—particularly data points related to the business chatbot and Meta AI—as well as the rationale behind the CapEx budget increase.
The response reflects a wider trend across large technology companies: rising AI investment is supporting long-term growth expectations, while also raising questions about near-term returns.
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