Meta Platforms (NASDAQ:META) is gearing up for its latest quarterly readout with the social media giant slated to release Q4 earnings today once the market action comes to a halt.
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According to Rosenblatt’s 5-star analyst, Barton Crockett, the latest move by Meta CEO Mark Zuckerberg offers an indication Meta’s business is firing on all cylinders.
Last Friday, in a Facebook post, Zuckerberg announced the company’s intention to spend $60-$65 billion in 2025 on AI-driven capex and Crockett thinks the Meta head would “probably only commit to a ~60% rise in capex if he was seeing a strong current revenue and great returns on past investments.”
“It also suggests competitiveness, and rising pressure for other hyperscalers to follow suit,” Crockett went on to add. “In this environment, Meta is advantaged by being arguably the biggest direct beneficiary to date of AI advancements, aside from pick-and-shovel makers of chips and data center equipment.”
Zuckerberg also said that 2025 is set to be a “defining year for AI,” while reiterating a previous announcement to build a data center exceeding 2GW in Richland Parish, Louisiana. This $10 billion, 4-million-square-foot project began in December 2024, with 1GW of computing capacity expected to go live in 2025. Meta also aims to have 1.3 million GPUs operational by the end of the year, a significant increase from the 600,000 mentioned back in January last year.
Based on Crockett’s 2025 revenue estimate (which is 5% above FactSet consensus), net capex near the midpoint of Zuckerberg’s 2025 outlook suggests a rise of 60% year-over-year, accounting for approximately 30% of total revenues.
As for what to expect from the upcoming results, Crockett is calling for Q4 revenue of $47.8 billion, amounting to 19% year-over-year growth and above FactSet consensus of almost $47 billion. Crockett is also expecting 19% revenue growth to $43.5 billion in 1Q25, also above FactSet consensus at $41.7 billion (up 14.5% y/y).
What does all this mean for investors? Ahead of today’s earnings report, Crockett rates META shares a Buy, setting a price target of $811 – suggesting a ~21% upside from current levels. (To check Crockett’s track record, click here)
Over the past three months, 44 analysts have weighed in on META. Of those, 40 recommend a Buy, 3 suggest holding, and 1 advises selling, culminating in a Strong Buy consensus rating. The average target stands at $693.51, implying a modest 3% upside over the one-year timeframe. (See Meta stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
