Meta Platforms’ AI Spending Spooks Market, But Analysts Stay Bullish

Meta Platforms ( (META) ) has been popular among investors this week. Here is a recap of the key news on this stock.

Meta Platforms has been hit by a sharp pullback, with the stock sliding around 9% in a week as investors digest its latest earnings and a major ramp-up in AI spending. Yet shares remain higher over the past month and year, and Wall Street still sees meaningful upside: the average 12‑month target sits near $826 versus a recent close around $612, underpinning a Strong Buy consensus.

The tension is clear: Meta Platforms delivered a strong Q1, with advertising revenue jumping roughly 29% year over year and Meta AI tools gaining early traction, but total expenses surged 35% as capex and compensation climbed. Management lifted its 2026 capex outlook by $10 billion to $125 billion–$145 billion, while Reality Labs continues to lose about $4 billion per quarter, even as AI‑powered wearables start to help.

Top analysts are split on near-term risk but broadly bullish on the long-term AI opportunity at Meta Platforms. J.P. Morgan’s Doug Anmuth cut the stock to Hold on concerns about heavy AI capex and stiff competition, while Oppenheimer’s Jason Helfstein also sits at Hold, citing slowing revenue growth and rising investment costs. Others, including BofA’s Justin Post, Piper Sandler’s Thomas Champion, and Goldman Sachs’ Eric Sheridan, maintain Buy ratings with targets from $800 to $835, arguing that Meta’s ad engine, growing engagement, and expanding AI ecosystem could ultimately justify today’s elevated investment cycle.