META Bets Big on the Future

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Rising.Stars identifying stocks that finish the trading day with impressive gains. With a focus on market dynamics and late-day trading patterns.
 

•  28 Jan 2026
 

•   META  
   
  0.00%

$META jumped 4% after posting stronger-than-expected fourth-quarter results and signaling an aggressive ramp-up in AI investments for 2026. The social media giant reported earnings of $8.88 per share on $59.9 billion in revenue, surpassing analyst expectations of $8.16 per share and $58.4 billion in revenue. For investors, the numbers reinforce that Meta advertising business remains a reliable engine of growth, even as the company pours billions into artificial intelligence and data center expansion.

The real market story, however, comes from Meta capital expenditure forecast. The company plans to spend $115–135 billion in 2026, a sharp increase from $72.2 billion in 2025. This investment spree reflects Meta long-term strategy to build out AI infrastructure, particularly high-performance data centers, and signals that management is betting heavily on future technologies to drive growth. The post-earnings rise comes after a roughly 10% decline since October, when investors worried about rising expenditures and their potential impact on profitability.

Reality Labs, the division behind Meta Metaverse efforts, continues to weigh on results. The unit generated $955 million in revenue, slightly below expectations, with an operating loss of around $6 billion. Since 2021, Reality Labs has accumulated tens of billions in losses, prompting the company to scale back operations and reduce staff. Yet, despite these challenges, Meta continues to invest in AI talent and companies, including a $14.3 billion acquisition of 49% of Scale AI and the appointment of CEO Alexander Wang to lead Meta AI initiatives.

The company faces execution risks. Development delays with the Llama 4 Behemoth AI model have prompted Meta to consider closing the next generation of AI models, diverging from its previous open-source strategy. Meanwhile, competitive pressures are mounting, with Google gaining an edge through Gemini 3 and OpenAI continuing to challenge the field. Regulatory scrutiny also looms, with initiatives to limit social media use by minors and ongoing antitrust considerations.

Despite these headwinds, Meta is doubling down on its core revenue engines. Advertising on WhatsApp and Threads is expanding, Reels continues to compete with TikTok and YouTube Shorts, and resources are being directed toward AI-powered wearable products, including smart AR glasses.

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