Meta Stock Rallies Into Earnings. What Numbers To Watch.

Meta platforms META stock rose early Monday, beginning its seventh straight positive trading day. The parent company of Facebook and Instagram reported third-quarter earnings late Wednesday.

Expectations are high after second-quarter results, which one analyst said “blowed the doors off.” Analysts expect Meta to report sales of $49.5 billion for the quarter ending in September, according to FactSet, representing 22% year-over-year growth.

This is Meta’s highest growth target this year. For the second-quarter and first-quarter Meta results earlier this year, analysts were expecting sales growth of 14% and 13%, respectively, ahead of the results. Meta outperformed both of these brands with sales growing 22% in the second quarter and 16% in the first quarter.

Meanwhile, analysts expect parent company Facebook to post an 11% increase in earnings to $6.72 per share, according to FactSet.

Nearly all of Meta’s revenue comes from digital ad sales on the company’s suite of apps, led by Facebook and Instagram. Stifel analyst Mark Kelly wrote to clients late last week that digital advertising is “generally well positioned,” with Meta remaining a top pick.

“Estimates look reasonable, as our checks highlight Instagram’s continued strength, although 2026 capex (and related expenses) will likely take center stage this quarter,” Kelly wrote.

MetaStock: Capital Monitoring

Meta has historically provided guidance for next year’s capex plan during its third-quarter report, although the company skipped providing specific numbers in last year’s third-quarter earnings statement.

Analysts currently expect Meta’s capital expenditures to reach $96.97 billion in 2026, a 41% increase over the estimated 2025 total. CEO Mark Zuckerberg has pledged to spend hundreds of billions on data centers and other computing infrastructure to ensure Meta is a leader in artificial intelligence.

Jefferies analyst Brent Thiel expects Meta’s 2025 capex to end at $72 billion, up 94% year over year, and capex of $103 billion for next year, he said in a note to clients on Friday.

“We do not expect Meta to significantly pull back on capex initiatives given the strategic importance of AI, ongoing high-profile hires, and the CEO’s repeated commitment to invest hundreds of billions in AI,” Thiel wrote.

“Investors are becoming more comfortable with higher levels of capital expenditures in the near term,” Kelly added in a Stifel client note. So the risk of Meta stock taking a hit from higher-than-expected 2026 expense guidance is “reasonably limited” in his view.

Meta vs OpenAI?

Meta stock is up 28% year to date but remains below its highs from early August.

The social media giant’s shares took a hit earlier this month due to the meteoric rise of OpenAI’s Sora, an AI-generated video app. Sora topped the list of most downloaded applications on… apple (AAPL) within days of its launch in late September.

Sora has overshadowed the similar Vibes AI video app built by Meta, and has also seen the emergence of a potential competitor to Meta’s Facebook and Instagram.

Zuckerberg may face questions from analysts on Wednesday about whether AI-generated video apps represent a competitive threat.

But could Sora actually be a good thing for Meta? One analyst raised this issue in a note this weekend.

Sora ultimately allows more videos to be created, similar to how TikTok and Instagram tools have made it easier to stitch together short videos, Bernstein’s Mark Shmulik said. Sora adds another level, giving people the ability to use computer-generated images to create new types of video.

“Sora is a creative tool… and what is a creator seeking to do with their art?” Shmulik wrote. “They need distribution, and are there any better distribution channels than Meta, TikTok, and YouTube? This influx of new content expands the library that these distribution platforms’ content recommendation algorithms can choose from to deepen user engagement and time spent.”

Recovers Meta Stock for 50 days

On the stock market today, Meta stock rose nearly 2% to 751.98 in morning trading. This helped Meta shares rise back above the 50-day moving average.

Monday’s gains add to a streak of positive trading for the Meta extending into Friday, October 17. Meta broke the negative trend line on its stock chart that started with a recent high of 790.90 on September 19. Shares fell 12% from that level to hit a low of 690.51 on October 6.

The latest action has put Meta stock into a newly formed double-bottom base with a buy point at 790.80, according to IBD MarketSurge.

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