Meta Platforms Stock Struggles Amid AI Spending Concerns
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Mar 23 2026
0mins
Should l Buy META?
Source: Fool
- Stock Underperformance: Meta Platforms' stock has struggled recently, down approximately 24% from its 52-week high of $796.25, reflecting market concerns about its future growth, particularly regarding AI investments.
- AI Spending Concerns: The company plans to increase capital expenditures to between $115 billion and $135 billion by 2026, a significant jump from last year's $72 billion, raising investor skepticism about the potential returns on such massive investments.
- Strong Financials: Despite challenges, Meta achieved 22% revenue growth last year with a profit margin of 30%, indicating its financial strength can absorb high-risk investments, although it faced $19 billion in losses from its metaverse initiatives.
- Bearish Market Sentiment: With bearish sentiment surrounding tech stocks and concerns over high AI spending, Meta's stock has declined about 9% this year, and without evidence of its AI strategy's success, further declines may be likely.
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Analyst Views on META
Wall Street analysts forecast META stock price to rise
44 Analyst Rating
37 Buy
6 Hold
1 Sell
Strong Buy
Current: 579.230
Low
655.15
Averages
824.71
High
1117
Current: 579.230
Low
655.15
Averages
824.71
High
1117
About META
Meta Platforms, Inc. is building human connections, powered by artificial intelligence and immersive technologies. The Company's products enable people to connect and share with friends and family through mobile devices, personal computers, virtual reality (VR) and mixed reality (MR) headsets, augmented reality (AR), and wearables. It also helps people discover and learn about what is going on in the world around them, enabling people to share their experiences, ideas, photos, videos, and other content with audiences ranging from their closest family members and friends to the public at large. The Company's segments include Family of Apps (FoA) and Reality Labs (RL). FoA segment includes Facebook, Instagram, Messenger, WhatsApp and Threads. RL segment includes its virtual, augmented, and mixed reality related consumer hardware, software and content. Its product offerings in VR include its Meta Quest devices, as well as software and content available through the Meta Horizon Store.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Company Performance Comparison: As of the afternoon prices on April 2, 2026, while both companies demonstrate strong performance, only one shows a superior investment return potential, indicating market confidence in its future growth.
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- Investor Decision Factors: When selecting investment targets, investors must consider factors such as financial health, market share, and future growth potential, as these will directly impact investment returns.
- Future Outlook: Although both companies exhibit solid market performance, investors should closely monitor their financial reports and market dynamics to make informed investment decisions.
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- Technological Advantage: The AGI CPU from Arm is seen as a highly efficient chip tailored for specific inference tasks, which may attract more companies to adopt it, further solidifying its position in the AI chip market.
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- Capital Expenditure Plans: In 2026, Alphabet plans to invest $175 billion to $185 billion, while Amazon and Meta are set to spend $200 billion and $115 billion to $135 billion on AI-related investments, demonstrating their commitment to technological innovation.
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See More
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- Valuation Strategy: Ackman entered these positions during periods of weak market sentiment, initiating his investment in Alphabet in Q1 2023 at a forward P/E ratio of 16, followed by Amazon in April 2025 at 25, and Meta in Q4 2025 at 20, demonstrating his commitment to value investing.
- Capital Expenditure Plans: In 2026, Alphabet plans to spend $175 billion to $185 billion, while Amazon and Meta are set to invest $200 billion and $115 billion to $135 billion respectively; Ackman believes these investments will drive future earnings growth despite ongoing concerns about returns.
- AI Progress and Market Demand: Ackman praised the AI advancements of these companies, noting that Alphabet's AI Overviews has over 2 billion users, Amazon's cloud services thrive on strong AI demand, and Meta leverages AI to enhance user engagement and advertising effectiveness, showcasing their leadership in technological innovation.
See More
