What will Wall Street will search for in Meta Q2 profits star-news.press/wp

The profits of the second quarter of Meta will not be just a referendum on the company’s advertising business-it will be a pivotal moment to assess whether the company’s feverish investments of artificial intelligence pay off or deplete its public budget. And when the company tops its numbers on Wednesday after the bell, it will be a test for Wall Street’s preparedness to move to the vision of Mark Zuckerberg CEO for the future.

Investors have greatly kept faith so far.

Meta beat Wall Street for four consecutive four, as her advertising works carried out most of the heavy lifting. But the company spends like building a new internet – perhaps because it is. Capital expenses for the entire year are now expected to reach a place between 64 and 72 billion dollars, to build AI’s infrastructure and devices, starting from the acting smart glasses to internal chips such as Hyperionion and Prometheus Superclusters.

Analysts expect Meta to report revenues between 44.55 billion dollars and 44.8 billion dollars, an increase of about 14-15 % on an annual basis, with the share in the scope of 5.83 – 5.89 dollars. The market may be less tolerant this time if there is no part of the artificial intelligence clear, but analysts remain optimistic. For each video, 25 of 27 analysts evaluate the “purchase” shares, with the price targets between 740-800 dollars, largely based on advertising growth, adopting artificial intelligence, and setting WhatsApp. However, the company is currently trading with profits forward 28.25X, leaving a large space for error if the capital expenditures of the technology or margin company rise.

Building “SuperIntelligence”

While the advertisement leads the ship, the ambition of Zuckerberg lies deeper. As part of the AI’s wider effort in Meta, he assembled a high-power team-which sheds to the highest talents of Openai, DeepMind, Google, and Apple, and beyond with aggressive wages packages, including one value of more than 200 million dollars. The new section, which is called Zuckerberg as the role of Meta Superinteigence, is led by AI AI ALEXANDR WANG, and former CEO of Github Nat Friedman and technology investor Daniel Gross calls him. Zuckerberg personally supervises employment, and is said to be inviting candidates via WhatsApp and group conversations called “A recruitment”.

The company’s goal: building artificial intelligence with the capabilities that can be nourished, well, everything. Zuckerberg said he believed Supertelligence “will be the beginning of a new era of humanity” and that he is “completely committed to doing what it takes to lead a dead.” Meta investments to make the great CEO dreams already occur.

In addition to building multi-graphic data centers to support the training of the artificial intelligence model, Meta has flowed billions of dollars on partnerships and acquisitions-including a $ 14 billion share in Scale AI-where it looks to possess models such as Llama 3 and 4 but the infrastructure and infrastructure under it. This type of ambitious Moonshot amazing amazingly with analysts: The Bank of America recently raised its target price on Meta to $ 783, saying that leadership is taking decisive measures to fortify AI’s stakes. The targeted price of the target price raised the price of $ 850, citing the potential reward for artificial intelligence innovations in advertising technology and expansion of the platform. However, some analysts began to doubt the wisdom of pouring a lot of capital in long -term bets without streaming revenues in the short term. On Friday, Guggenheim Meta was reduced to “Neutral”, saying that the noise associated with AI was already.

Now, any optimism of artificial intelligence comes with increasing expectations. If the results of this quarter show only the puffs of the artificial intelligence or the deterioration of the margin, the high-vision of Zuckerberg for free spending-can suddenly look more fragile. The question that investors will ask: When will any Amnesty International spending a meaningful investment?

Footage on books

Meta was put on the AI’s red carpet for better ads returns and a deeper user sharing. The Silicon Valley giant continues to revenue advertising – the last quarter, with $ 41.4 billion, approximately 98 % of the total revenue for a quarter (42.3 billion dollars). But now, the company is invested widely. While AD products are supported by artificial intelligence – such as Advantage+ and Andromeda – continue to show modest gains, the broader environment requires flawless implementation, and even a strong quarter may fulfill expectations only amid investor evaluations in the sky. The recovery of Chinese advertisers across the border, led by Shin, Timo and Albaba, has increased dead advertising revenues in the last quarters. Whether this trend will happen in the second quarter, it will be seen closely.

But behind the main headlines of Meta lies a realistic fact: the reality laboratory department continues to burn billions, and the expectations of consensus grow up to a price that requires a flawless implementation. In the first quarter of the year, this section recorded $ 4.2 billion of losses – after it was published in the losses of $ 17.7 billion in 2024; This number may rise to nearly $ 20 billion in 2025, including approximately $ 4.9-5.3 billion in this quarter in some of the latest estimates. Many Zuckerberg and Metaverse Vision devices have not yet been fruitful, and META’s virtual reality bets have struggled with Horizon and Skest worlds – to reach the main users.

One bright point: Ray-Ban Meta smart glasses, advanced with Essilorluxotica. Zuckerberg claimed in the profit call in the first quarter that the Meta glasses partnership has multiplied three times in sales “on an annual basis, and there is a plan to prepare the production of up to 10 million units annually. The glasses have now been combined with the independent Meta application and Amnesty International Llama 4. Despite the increasing privacy interests on the use of smart glasses, Meta doubles on devices with a share of $ 3.5 billion in Essilorloxotica and partnership with Oakley.

Chat profits

The Meta’s Stelight Monetiest might not be in your summary – but in your chats. WhatsApp is still a slow opportunity to reach Meta with increasingly existing analysts about the capabilities of its revenue, and this quarter may be a pivotal in showing the early signs of this promise. Meta was launched: ads in the WhatsApp update tab, paid channel subscriptions, and promoted business channels. The company began integrating artificial intelligence agents into WhatsApp-including customer service agents working in Llama 3, assistants of small companies, and virtual shopping guides in the early stage-with the expansion of the commercial correspondence platform calmly worldwide.

WhatsApp is now proud of more than 200 million companies using their tools, according to Bank of America, and analysts believe that their long -term revenue capabilities may exceed $ 20 billion annually if even a modest share of users adopt services supported by artificial intelligence or commercial messages. Advertising revenue exceeded the click to the stage $ 10 billion annually – and it may rise to 40 billion dollars, for every expectation of Wolfe Research and William Blair from Ralph Schakart, which is estimated that WhatsApp can achieve $ 5 billion from early profit by 2028. However, the organizational pressure and the reverse reaction – especially in Europe and India – can perform To the cloud of the upward trend. If there are any new details or color about sharing or income rates during Wednesday’s profit call with Zuckerberg and other driving, this field may be a major maker.

Topics quietly scaling, too. But liquefy on topics is still in early roles. Any color at a time when spent, advertiser tests, or user retention – especially in the context of WhatsApp and Instagram strategies – can affect analysts ’morale. Investors will also search for updates about the time the daily active users and users spend via Facebook and Instagram, especially in North America and Europe, where the growth started. Any slowdown in the user’s participation can press advertising revenues and saturation in the basic works of Meta. R buts continues to bridge the income gap from the stories, but investors will want new data on downloading ads and clicking rate

The price of presence everywhere

On the Llama front, the Meta Open Models of Central Aid remains, but the criteria show that Lama 3 is still lagging behind GPT -4O and Claude 3.5 in many areas, while Lama 4 (called “Behehamh” internally witnessed delays. Meta greatly bent in distribution instead – include Llama in WhatsApp, Instagram, Messenger and Smart Gasses – hoping that wide use will compensate for raw models. Unlike Openai or Anthropic, Meta has yet to launch an interface or a paid-paid firm for Llama-is the option that reflects its open source position but also limits the short-term liquefaction. Research questions: Are dead construction models to lead … or only to distribute them? Analysts will adjust the scales of participation and retain as health verification.

Margin discipline is another major line for checking. Capex enlarges, but Wall Street is especially sensitive at the present time for operational effectiveness. Meta margins decreased in the last quarter slightly (from 38 % to 37 %), and if it is more erosion – especially in employing or burning data or the costs of reality laboratories – the evaluation will be weak. However, with approximately $ 60 billion in cash and a strong free cash flow, the customization of the Meta capital (including potential re -purchases) may help in a COUSHION investor if the guidance is disappointed.

The organizational risks lie in each corner of the Amnesty International. The company refused to sign the volunteer practice blog for the European Union, on the pretext that the instructions that provide legal uncertainty beyond the current artificial intelligence law, and raise the scope of tensions with Brussels where the legislation is entered by August 2026. The company is struggling with organizational f Ham in Europe after the 20025 million euros of digital markets law, which imposes it on providing limited versions and data from its advertising products in Europe, which already leads to a reduction in the transfers of small and medium advertisements by up to 70 %. Meta is attractive, but the ruling may force strategic changes before the third quarter. Elsewhere, Meta faces continuous legal battles on moderate content, work practices, data transfer, tax structures, and alleged bad behavior.

After the second quarter, Meta’s instructions in the third quarter can specify the tone of the stock. Investors will be sensitive to signs of softening the budgets of advertising or increasing opposite winds, especially since the patterns of spending on seasonal ads turn into a high environment.

Ultimately, Wall Street will watch to see if Meta can connect the needle: converting high infrastructure and employment in the sky into significant gains in products and revenues while formulating (and bypassing) its competitors in the artificial intelligence race. With Meta shares rise more than 19 % so far and currently trading near its highest levels, the risks cannot be higher-the margin of the error can not be smaller.