Meta Stock Drops 5% On Higher Capex; Q1 Earnings Beat
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- Meta beat top and bottom lines last quarter, but its stock fell more than 5% in late trading Wednesday on market jitters over expanding capex.
- Meta raised its full-year capex range to $125 billion–$145 billion, up from prior guidance of $115 billion–$135 billion, citing data centers, higher component pricing, and competition against bigger rivals.
- Meta's daily active people (DAP) averaged 3.56 billion in March, up 4% year-over-year but down slightly from the previous quarter.
- Meta attributed the DAP softness to internet disruptions in Iran and restrictions on WhatsApp access in Russia.
- Meta's net income jumped 61% to $26.1 billion, while revenue climbed 33% to $56.3 billion, driven primarily by advertising.
Why it matters: Meta's capex jump to a $125B–$145B range signals heavy spending on data centers and components as it competes with bigger rivals, pressuring near-term margins. The 61% net income surge couldn't offset investor worry, and the first DAP dip tied to Iran disruptions and Russia's WhatsApp block shows geopolitics can dent even the largest platforms.
