TD Cowen Analyst Says Meta and Google Face Legal Challenges
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Mar 26 2026
0mins
Should l Buy META?
TD Cowen policy analyst Paul Gallant says the juries in Los Angeles and New Mexico finding Meta Platforms (META) and Google (GOOG, GOOGL) liable for harming children through addictive product design are notable. However, the "linchpin case" is 30 state attorneys general versus Meta, which goes to trial in August, the analyst tells investors in a research note. TD believes the companies' best hope may be getting the San Francisco case dismissed under Section 230 or getting Congress to limit their lawsuit exposure in exchange for new regulations.
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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: 678.620
Low
655.15
Averages
824.71
High
1117
Current: 678.620
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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- Market Focus Areas: Investors are keenly awaiting updates on Threads' user growth and engagement, which are expected to influence Meta's overall strategic positioning within its social ecosystem, particularly in expanding capabilities in content creation and artificial intelligence.
- Cloud Strategy: Market participants are closely monitoring how Meta is scaling its infrastructure to support AI workloads and digital services, with cloud-related commentary being a key focus in the earnings report that could sway investor sentiment.
- Trading Platform Predictions: According to trading activity on Kalshi, investors predict that Threads, Muse, and cloud services will be key discussion points in the earnings call, with attention levels at 98%, 97%, and 94% respectively, indicating high market interest in these themes.
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- Cost Control Measures: The company plans to cut 8,000 jobs, or 10% of its workforce, and eliminate 6,000 open positions, a move aimed at enhancing operational efficiency and offsetting costs from other investments, demonstrating Meta's commitment to its transformation.
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- Partnership Shifts: Amazon announced that OpenAI's models will be available on its AWS cloud service, following a significant shake-up in OpenAI's partnership with Microsoft, indicating strategic adjustments that could affect OpenAI's market position.
- Intensifying Competition: Alphabet is directly competing with OpenAI through its Gemini models, and while OpenAI is seen as a threat, analysts believe it is manageable; Alphabet's stock has doubled over the past year, reflecting strong growth in its cloud business.
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See More
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- Massive Investment Plans: Meta plans to invest up to $169 billion in AI-related expenditures in 2023, including a multibillion-dollar partnership with Amazon Web Services aimed at enhancing its core advertising business's computing capacity, which is expected to positively impact future revenue growth.
- Job Cuts and Cost Control: Meta announced it will cut about 8,000 jobs, roughly 10% of its workforce, which is projected to save between $3 billion and $10 billion annually, further optimizing resource allocation to support AI investments; while layoffs are typically unwelcome, analysts view this as a bullish development.
- Advertising Business Growth: Instagram Reels watch time increased by 30% year-over-year, showcasing the effectiveness of its AI-driven ad tools like Advantage+, with the upcoming Muse Spark project expected to further enhance ad performance and drive revenue growth for the company.
See More
Meta Platforms Earnings Preview: Key Investor Focus Areas
- Earnings Preview: Meta Platforms (META) is set to release its earnings report, with the stock modestly up about 1.2% year-to-date and trading near $671, reflecting cautious optimism among investors regarding the company's future performance.
- Market Focus Areas: Investors are keenly awaiting updates on Threads' user growth and engagement, which are expected to influence Meta's overall strategic positioning within its social ecosystem, particularly in expanding capabilities in content creation and artificial intelligence.
- Cloud Strategy: Market participants are closely monitoring how Meta is scaling its infrastructure to support AI workloads and digital services, with cloud-related commentary being a key focus in the earnings report that could sway investor sentiment.
- Trading Platform Predictions: According to trading activity on Kalshi, investors predict that Threads, Muse, and cloud services will be key discussion points in the earnings call, with attention levels at 98%, 97%, and 94% respectively, indicating high market interest in these themes.
See More
Meta Platforms Set to Report Q1 Earnings with Focus on AI Investments
- Earnings Expectations: Meta is expected to report adjusted EPS of $8.15 and revenue of $55.5 billion for Q1, a significant increase from last year's $42.3 billion, reflecting the company's ongoing investments in AI and rising market demand.
- Cost Control Measures: The company plans to cut 8,000 jobs, or 10% of its workforce, and eliminate 6,000 open positions, a move aimed at enhancing operational efficiency and offsetting costs from other investments, demonstrating Meta's commitment to its transformation.
- Future Spending Forecast: Meta anticipates total expenses for 2026 to range between $162 billion and $169 billion, with capital expenditures projected at $115 billion to $135 billion, and investors will closely monitor updates to these figures to assess the company's financial health.
- Industry Competitive Dynamics: Alongside peers like Microsoft, Amazon, and Alphabet, Meta has pledged to spend over $650 billion on AI investments by 2026, underscoring the company's significant position in the global AI investment wave and its strategic focus on future growth.
See More
OpenAI Faces Legal Challenges and Market Pressures
- Significant Market Influence: OpenAI's valuation exceeds $850 billion, establishing it as a major market mover, despite its financials being private; investor focus on its revenue and spending highlights the immense potential and risks within the AI sector.
- Escalating Legal Dispute: The legal battle between OpenAI CEO Sam Altman and Tesla CEO Elon Musk intensifies, with Musk alleging breaches of the founding agreement, potentially impacting OpenAI's reputation and investor confidence.
- Shifting Partnerships: Amazon's announcement to integrate OpenAI models into its AWS cloud service, alongside Microsoft's restructuring of its partnership with OpenAI, both of which are major investors, could alter the competitive landscape in the tech industry.
- Talent Acquisition Battle: Meta's attempts to lure OpenAI employees with signing bonuses up to $100 million illustrate the fierce competition for talent in the AI field, and OpenAI's response strategies will directly affect its technological advancement and market position.
See More
Market Preview: Tech Giants Earnings Day
- Fed Rate Decision: The Federal Reserve is expected to keep interest rates unchanged this afternoon, with market participants closely watching Chair Powell's press conference, which could influence investor confidence in the economy's future.
- Tech Giants Earnings: Alphabet, Amazon, Meta, and Microsoft are set to report earnings after the bell, with high expectations for Alphabet's cloud and advertising growth, while Amazon must discuss more than just its cloud success to maintain its stock price.
- Seagate Strong Performance: Seagate reported a strong quarter that exceeded expectations, driven by surging demand for data storage technology in the AI era, with its stock up 600% over the past year and an additional 16% increase today.
- Visa Quarterly Results: Visa's quarterly performance was robust, with limited disruption from the Middle East, announcing a $20 billion buyback plan and projecting low double-digit to low-teens revenue growth for the year, resulting in a stock price increase of over 5%.
See More
OpenAI's Impact on Major Tech Earnings Reports
- Uncertain Earnings Outlook: Amazon, Alphabet, Meta, and Microsoft are set to report earnings on Wednesday, with concerns over OpenAI's failure to meet internal growth expectations leading to a decline in shares of AI infrastructure-related companies, negatively impacting investor confidence.
- Partnership Shifts: Amazon announced that OpenAI's models will be available on its AWS cloud service, following a significant shake-up in OpenAI's partnership with Microsoft, indicating strategic adjustments that could affect OpenAI's market position.
- Intensifying Competition: Alphabet is directly competing with OpenAI through its Gemini models, and while OpenAI is seen as a threat, analysts believe it is manageable; Alphabet's stock has doubled over the past year, reflecting strong growth in its cloud business.
- Talent War: Meta's attempts to poach OpenAI employees with signing bonuses as high as $100 million highlight the fierce competition for talent in the AI sector, and although Meta's AI strategy has not fully succeeded, its newly launched Muse Spark model shows promising early test results.
See More
Meta Platforms' AI Investments Show Signs of Recovery as Stock Rebounds
- Stock Recovery: Meta's shares rebounded 28% after a 29% decline, closing at $671 on Tuesday, indicating a gradual restoration of market confidence in its AI investments, particularly following the release of a new AI model that has sparked optimism about advertising growth prospects.
- Massive Investment Plans: Meta plans to invest up to $169 billion in AI-related expenditures in 2023, including a multibillion-dollar partnership with Amazon Web Services aimed at enhancing its core advertising business's computing capacity, which is expected to positively impact future revenue growth.
- Job Cuts and Cost Control: Meta announced it will cut about 8,000 jobs, roughly 10% of its workforce, which is projected to save between $3 billion and $10 billion annually, further optimizing resource allocation to support AI investments; while layoffs are typically unwelcome, analysts view this as a bullish development.
- Advertising Business Growth: Instagram Reels watch time increased by 30% year-over-year, showcasing the effectiveness of its AI-driven ad tools like Advantage+, with the upcoming Muse Spark project expected to further enhance ad performance and drive revenue growth for the company.
See More
