A year ago we published our article on Meta Platforms. The conclusion at the time was clear: the company has enormous potential, but the stock price was in the midst of a sharp correction that would require patience. We are now a year on and much has changed, both at the company itself and in the stock market. Time for a thorough update.

In the March 20, 2025 article "Meta Platforms: technical correction gives opportunity!" we gave the background and initial price target at $850. We recommend that you read this article first.

What is the current situation at Meta Platforms?

Meta presented strong annual and quarterly results on January 28, 2026, with clear growth in revenue, profitability and user numbers. For all of 2025, revenue increased 22% to over $200 billion, while the fourth quarter showed 24% growth at $59.89 billion.

Earnings per share came in well above expectations at $8.88, with an operating margin of 41% and net profit of $22.8 billion. The number of daily users reached 3.58 billion, and both ad impressions and prices continued to rise.

Yet the positive picture was overshadowed by two developments. First, its ambitious investment plans: Meta announced it would increase capital spending to potentially $135 billion by 2026, almost entirely focused on AI infrastructure. Second, the definitive end of the Metaverse dream. In our previous article, we expressed little confidence in the metaverse as a viable product, and the facts prove us right. Meta has effectively abandoned its metaverse ambitions in favor of AI.

Reality Labs, the division within Meta responsible for developing virtual reality hardware, software and augmented reality products, lost $19.2 billion in all of 2025, with a quarterly loss of about $6 billion in the fourth quarter alone. In January 2026, more than 1,000 employees at Reality Labs were laid off and Meta announced it was turning Horizon Worlds, the social VR platform once central to its Metaverse strategy, into a mobile app. After nearly $73 billion in cumulative losses since 2021, the change in direction is clear: Meta is betting on what does work, namely AI integrations and smart glasses.

The market initially reacted enthusiastically to the quarterly results, and the stock rose nearly 10% in after-hours trading, but sentiment then turned due to concerns about rising costs and pressure on future margins.

What is currently the view of international analysts?

The mood among Wall Street analysts on Meta is remarkably united at the moment. Of the analysts following the stock, virtually none have a sell recommendation out and the consensus rating is at "Strong Buy. That is exceptional for a company of this size.

The average price target is around $856, with outliers toward $1,144. That wide range reflects uncertainty about how quickly Meta is going to get returns on its massive AI investments. Analysts agree that the ad model remains strong and that its user base of 3.58 billion daily users provides a unique competitive advantage. In this regard, the bet on AI integrations and smart glasses is increasingly seen as the next pillar of growth.

The main concern is not the company's fundamental strength, but its timing. Capital spending of potentially $135 billion by 2026 is historically high, and the question is when those investments will translate into tangible profits. Morgan Stanley recently lowered its price target but at the same time called the stock a new top pick, saying that this is an attractive entry point. Therefore, the current share price decline is seen by most analysts as a temporary correction, not a structural problem.

Conclusion

Meta still shows a very strong picture fundamentally, with solid growth in revenue, earnings and user numbers. At the same time, the substantial investments in AI create uncertainty in the short term, which is clearly reflected in the current share price performance.

Whereas the market is primarily focused on rising costs, we actually see the strategic shift as a logical and necessary step toward future growth. The combination of a dominant advertising position, an unmatched user base and the increasing integration of AI offers significant longer-term potential.

Technically, we expect the correction to be nearing its final phase. As visible in the chart, we consider a final move towards the $445 to $385 zone plausible. It is precisely in this phase that the most attractive entry moments arise for investors who want to position for the next upward movement. Our price target of $850 remains unchanged in this regard. We therefore do not see the current weakness as a structural problem, but as an opportunity to build up a position in phases leading up to this longer-term rise.

Disclaimer: Investing involves risk. Our analysts are not financial advisors. Always consult an advisor when making financial decisions. The information and tips provided on this website are based on our analysts' own insights and experiences. They are therefore for educational purposes only.