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Meta Q4 Earnings Preview: TikTok, AI, spending

Jan 28, 2025 - businessinsider.com
Meta is set to report its fourth-quarter earnings amid heightened scrutiny due to a recent tech sector sell-off triggered by the debut of DeepSeek, a new AI model from a Chinese startup. Analysts are focused on Meta's AI monetization strategies, with expectations of strong advertising growth driven by AI integration into platforms like WhatsApp and Messenger. Meta's potential benefit from TikTok's challenges and its plans for significant capital expenditures on AI are also key points of interest.

Various financial institutions have expressed optimism about Meta's prospects. Bank of America, JMP, Truist Securities, Jefferies, and CFRA Research have all maintained positive ratings on the stock, citing factors such as AI investment, potential gains from TikTok's issues, and strong ad spending. Analysts expect Meta to post robust revenue growth and see the company's AI initiatives as a significant driver of future performance.

Key takeaways:

  • Meta is set to report its fourth-quarter earnings amid heightened scrutiny due to recent market disruptions caused by DeepSeek, a new AI model from a Chinese startup.
  • Analysts expect Meta to benefit from AI monetization, potential disruptions to TikTok, and cost-cutting measures, with positive revenue growth anticipated for 2025.
  • Meta plans significant capital expenditures on AI, indicating the early stages of an AI investment cycle, which is viewed positively by analysts.
  • Various financial firms maintain a "Buy" rating on Meta, with price targets suggesting moderate upside potential from current stock levels.
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