Meta reported another significant increase in capital expenditure, spooking investors and pushing the stock lower. Goldman Sachs trimmed its price target to $830 and Stifel cut to $780, both flagging concerns that spending growth is outpacing near-term returns. Evercore ISI bucked the trend, lifting its target on confidence in Meta's AI execution.
Heavy capex signals Meta is betting big on AI infrastructure — but that spending compresses profits in the short term, which is why the stock sold off. Investors holding META directly or through broad tech ETFs like QQQ should expect continued volatility until Meta demonstrates that this spending is translating into measurable revenue gains. The split between bearish Goldman/Stifel and bullish Evercore shows Wall Street is genuinely divided on whether this is disciplined investment or overreach.
Meta's next earnings call (expected late July 2025): watch for any updated capex guidance and whether AI investments are showing revenue impact. Any Fed commentary on rates in June 2025 will also matter, since higher rates make heavy-spending companies look less attractive to investors.
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