Key financial metrics:

• First-quarter revenue: $56.3 billion
• Daily active users: 3.56 billion
• Stock drop: 6%
• Capital expenditures: $19.84 billion
• Average estimate for capital expenditures: $27.57 billion

Despite the revenue success, investor sentiment soured as Meta’s capital expenditures totaled $19.84 billion, significantly below the average estimate of $27.57 billion. In response to these figures, Meta raised its full-year capital expenditure guidance to a range of $125 billion to $145 billion while maintaining its expense outlook at between $162 billion and $169 billion.

Mark Zuckerberg emphasized the company’s commitment to investing in AI infrastructure, stating, “I expect that we will invest a significant amount of capital over the coming years to pursue that opportunity.” This statement reflects Meta’s strategic focus on enhancing its technology capabilities amidst challenges in user growth.

The company’s headcount rose by 1% year-on-year to 77,986 employees as of March 31. This slight increase indicates ongoing investment in talent despite overall concerns regarding operational efficiency.

This earnings report arrives during a period of strong momentum in technology stocks, with the Nasdaq Composite up 14% for the month through Wednesday’s close. However, analysts caution that Meta’s struggles with user engagement could impact its long-term viability.

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