Meta Platforms Inc: 2Q preview: Expecting a beat, ad revs. & external compute sales in focus

Research evidence excerpt

Meta Platforms Inc: 2Q preview: Expecting a beat, ad revs. & external compute sales in focus

8% y/y and 10% q/q to 70,187. Our review of open roles suggests hiring remains

concentrated in AI data and analytics, data center operations, and infrastructure.

FY26 capex likely to go higher on component pricing & capacity constraints

On 1Q’26 call Meta increased FY26 capex guide by ~8% ($10bn) to $125-$145 citing

higher component pricing (such as memory, etc.). We do not expect AI infrastructure

investment to slow near term given industry-wide compute capacity constraints and see

potential for Meta to raise its FY26 capex guidance to $135-$150bn (from $125-

$145bn). We recently increased our FY26 capex estimate to $145bn and continue to see

upside potential to Street estimates at $136bn.

Key Areas to address on call

Muse Spark usage and benefits, new licensing model

We think a key focus of the call will be the benefits of Muse Spark for model-driven

product development, the pipeline of AI-native products, and internal productivity.

Investors will likely focus on whether Muse Spark is helping Meta accelerate product

development timelines, improve engineering efficiency, and enable new AI experiences

across ads, messaging, business tools, creator products, and other surfaces. Commentary

on measurable productivity gains and the roadmap for externally facing products could

help the Street better assess how Meta’s model investments translate into both cost

efficiency and future monetization opportunities. We also think the new API licensing

commentary will be important, as it represents a move toward paid, usage-based access

for some of Meta’s AI models and could provide an early read on external developer

demand, model competitiveness, and longer-term monetization potential.