$125 billion to $145 billion. That is what Meta Platforms (NASDAQ:META | META Price Prediction) now expects to spend on capital expenditures in 2026, raised from a prior range of $120 to $135 billion when the company reported first-quarter results on April 29, 2026.
Now, this is forward-looking guidance, not a reported figure. That said, this number stands against a 2025 full-year capex base of $72.215 billion. The framing writes itself: Meta is preparing to deploy roughly $50 billion more on AI infrastructure this year than last, and CFO Susan Li told analysts the raise reflects “higher component pricing this year and, to a lesser extent, additional data center costs to support future-year capacity.”
What It Means
The scale is what stops you. In the first quarter alone, Meta spent $18.997 billion on capex, up 46.8% year over year. The company also disclosed that multiyear cloud deals and infrastructure purchase agreements drove a $107 billion step up in contractual commitments during the quarter. Zuckerberg framed the spend directly: “We are investing aggressively to meet our infrastructure needs and ensure we maximize our strategic flexibility over the coming years.”
What backs the spend is a business still compounding at scale. Q1 revenue came in at $56.311 billion, up 33.08% year over year, with operating income of $22.872 billion and a 41% operating margin. Ad impressions rose 19% and average price per ad rose 12%, both year over year, while family daily active people reached 3.56 billion. Free cash flow was $12.386 billion in the quarter, and operating cash flow reached $32.226 billion. Additionally, reported EPS of $10.44 exceeded expectations against a consensus of $6.6587, though investors should note the beat was inflated by an $8.03 billion one-time tax benefit tied to U.S. Treasury guidance on capitalized R&D, worth $3.13 per share.
Market Reaction
Meta shares have not rewarded the Capex raise. From the Q1 filing date on April 29, 2026 through July 2, 2026, the stock is down 12.81%, moving from $668.53 to $582.90. Year to date, shares are off 11.54%. Over the past week, however, the stock has moved higher by 7.37%, and one TradingKey report attributed a 7.56% single-day gain on July 1 to plans to launch a cloud infrastructure business selling excess AI computing capacity.
Bull Case
The bull case rests on three data points that connect the capex to cash. First, monetization is accelerating alongside the AI build. On Instagram, Q1 ranking improvements drove a 10% lift in Reels time spent, and Facebook video time rose more than 8% globally, the largest quarter-over-quarter gain in four years. Enhancements to the Lattice and GEM ad models delivered a more than 6% increase in conversion rate for landing page view ads.
Second, the business AI layer is scaling from a small base. Susan Li said Meta now has “more than 10 million conversations each week being facilitated through business AIs, up from 1 million at the start of the year.”
Third, the company is diversifying compute suppliers to control cost, with Zuckerberg noting Meta is “rolling out more than one gigawatt of our own custom silicon that we are developing with Broadcom as well as a significant amount of AMD chips to complement the new NVIDIA systems.”
I think Meta’s valuation still frames the setup as reasonable for a business growing revenue in the low 30s. The company’s trailing P/E multiple sits at 22, forward P/E at 19, and the analyst consensus target is $828.13 against a current price of $582.90. Ratings tilt heavily positive with 8 strong buy, 49 buy, 6 hold, and zero sell ratings. Prediction markets favor Meta over OpenAI at 81% probability of a higher year-end valuation.
Bottom Line
For long-term holders, Meta’s raised capex range is the clearest statement the social media and tech giant has made about where the next decade of returns will come from. The company’s Q2 guidance calls for revenue of $58 to $61 billion, and management expects full-year 2026 operating income above 2025 levels even after absorbing the higher spend.
The next test is the Q2 earnings report against that $58 to $61 billion range. If ad pricing, impression growth, and business AI adoption keep compounding, the $125 billion to $145 billion looks like scale investors will eventually pay up for. If any of those levers slip, the same number becomes the bear case in one earnings cycle.
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