Meta Forecasts $30B Capex Surge for AI Push by 2026

According to the article, Meta Platforms is expected to significantly increase its capital expenditure by $30 billion in 2026 to support its push toward superintelligent AI. While this may lead to tighter margins in 2026 if revenue growth slows, analysts believe Meta's AI investments are already generating meaningful returns and opening new monetization paths, such as content creation tools, AI assistants, and devices.

Analysts have raised their 2025 revenue and EPS estimates by 5% and 11%, respectively, and their 2026 projections by 9% and 12%. They cite Meta's strong position to capitalize on the rise of agentic AI platforms, with upcoming catalysts like the Connect conference potentially adding further upside.

The article highlights that Meta's AI-powered improvements have driven steady, compounding increases in time spent on Facebook and Instagram, with Instagram video engagement growing over 20% year-over-year globally. These engagement gains are fueling impression growth and unlocking deeper monetization opportunities, with AI-powered systems contributing to 3-5% increases in ad conversions across Meta's platforms.

While Meta's 2026 capex projection rises by 17%, analysts believe the optionality from OBBBA (On-Behalf-Of Business Buying Ads) could more than offset this decline, potentially adding $4 per share in free cash flow versus the ~$3 per share cut from higher spending. They argue that Meta's long-term monetization runway, reinforced by faster revenue and EPS growth, justifies a higher valuation multiple.