Meta beats Q1 2025 expectations as ad revenue and AI investments surge
Meta revenue jumps in Q1 as Zuckerberg commits to AI and growth (Illustrative photo: Getty Images)
Meta once again surpassed Wall Street's expectations in Q1 2025 thanks to robust advertising revenue and a bold expansion of its AI infrastructure, Reuters reports.
Meta Platforms, the parent company of Facebook and Instagram, reported $42.31 billion in revenue for the first quarter, beating analyst estimates of $41.40 billion.
Profit soared to $6.43 per share, far above the $5.28 forecast. The company also set a bullish tone for Q2, projecting revenue between $42.5 billion and $45.5 billion.
In a post-earnings call, CEO Mark Zuckerberg said, "The pace of progress across the industry and the opportunities ahead for us are staggering. I want to make sure that we're working aggressively and efficiently, and I also want to make sure that we are building out the leading infrastructure and teams."
Mark Zuckerberg, CEO and founder of Meta (Photo: Getty Images)
Meta now expects to spend $64–72 billion on capital expenditures in 2025, up from the previous $65 billion estimate.
While most of the investment is focused on core operations like ad computing, CFO Susan Li noted it also supports AI infrastructure and hedges against potential tariff-driven hardware cost spikes.
Strong user growth, cautious optimism amid global uncertainty
Meta's platforms continue to dominate global engagement.
Daily active people (DAP) across its family of apps rose 6% year-over-year to 3.43 billion.
Nearly 1 billion users now engage monthly with Meta's AI assistant, and Zuckerberg emphasized that growing engagement is the top focus before monetization.
Despite a solid Q1, Meta isn't immune to external risks. CFO Li warned, "There could be a significant impact to the European business as soon as the third quarter," referencing a Digital Markets Act ruling.
In addition, Meta is preparing for a critical antitrust trial in Washington over its acquisitions of Instagram and WhatsApp.
With digital ad budgets tightening amid US tariff concerns, Meta's advertising strength remains a key asset. "If ad revenue continues to hold strong, then this increase in capital expenditures will be less of a bitter pill for investors to swallow," said Debra Aho Williamson, chief analyst at Sonata Insights.
Meta's resilience under economic pressure reinforces its position as a digital advertising powerhouse and AI innovator.
Tesla, by contrast, is facing a tough start to 2025 — its stock is falling, sales are weakening, and pressure on Elon Musk from investors and politicians is mounting. Analysts are calling this a pivotal year for the company.
