Meta Platforms (NASDAQ:META) Trading Down 8% Following Weak Earnings

Shares of Meta Platforms, Inc. (NASDAQ:META) fell 8% during trading on Thursday following a dissappointing earnings announcement. The company traded as low as $524.49 and last traded at $539.03. Approximately 41,945,602 shares changed hands during mid-day trading, an increase of 148% from the average daily volume of 16,888,010 shares. The stock had previously closed at $585.61.

The social networking company reported $6.18 earnings per share (EPS) for the quarter, missing the consensus estimate of $7.19 by ($1.01). The business had revenue of $60.80 billion during the quarter, compared to the consensus estimate of $60.22 billion. Meta Platforms had a net margin of 32.84% and a return on equity of 36.93%. The business’s revenue was up 28.0% compared to the same quarter last year. During the same period last year, the company posted $7.14 earnings per share.

Meta Platforms Announces Dividend

The firm also recently declared a quarterly dividend, which was paid on Thursday, June 25th. Stockholders of record on Monday, June 15th were paid a $0.525 dividend. The ex-dividend date was Monday, June 15th. This represents a $2.10 annualized dividend and a dividend yield of 0.4%. Meta Platforms’s payout ratio is currently 7.63%.

More Meta Platforms News

Here are the key news stories impacting Meta Platforms this week:

• Positive Sentiment: Revenue increased 28% year over year to $60.8 billion, exceeding expectations, while strong advertising demand, higher ad prices and AI-powered recommendations supported engagement. META’s Q2 Earnings Miss Estimates, Revenues Rise Year over Year on Ad Growth
• Positive Sentiment: Several analysts maintained bullish ratings despite reducing price targets. UBS, Citigroup, Truist, TD Cowen, Bank of America and others continue to rate META Buy, Outperform or Overweight, implying substantial potential upside from current levels. Analyst price-target updates
• Positive Sentiment: Meta highlighted AI-related gains in advertising and personalization, as well as plans for additional AI-enabled applications and enterprise products. WhatsApp also reported record messaging activity, supporting the company’s long-term platform reach. Meta says AI is making it easier to build new apps
• Neutral Sentiment: Reality Labs lost more than $4.6 billion, although the loss was narrower than analysts expected. Meta is also exploring ways to lease excess computing capacity, which could eventually create an additional revenue stream but remains unproven. Meta’s Reality Labs lost over $4.6 billion in second quarter
• Negative Sentiment: Second-quarter EPS was $6.18, below estimates near $7.20 and down from $7.14 a year earlier. Legal expenses, severance costs and higher operating expenses pressured profits despite the revenue beat. Meta profit misses estimates on higher costs
• Negative Sentiment: Investors were particularly concerned that capital expenditures are consuming nearly all operating cash flow. Meta generated $31.9 billion in operating cash flow but retained only $784 million after investment, while 2026 AI and infrastructure spending is expected to reach $130 billion-$145 billion. Meta generated $31.9 billion in operating cash flow last quarter
• Negative Sentiment: Third-quarter revenue guidance of $61 billion-$64 billion was below the roughly $63.2 billion consensus midpoint, reinforcing worries about slowing growth and limited visibility into AI monetization. Future AI data-center lease obligations also climbed to $279 billion, intensifying balance-sheet and execution concerns. Meta’s future AI data center lease obligations swell

Analyst Ratings Changes

Several equities research analysts recently commented on the company. Truist Financial dropped their price objective on Meta Platforms from $840.00 to $770.00 and set a “buy” rating on the stock in a research report on Thursday. Weiss Ratings lowered Meta Platforms from a “buy (b-)” rating to a “hold (c+)” rating in a research report on Friday, June 26th. Piper Sandler restated an “overweight” rating and set a $785.00 target price (down from $800.00) on shares of Meta Platforms in a research note on Thursday. UBS Group dropped their price target on shares of Meta Platforms from $766.00 to $715.00 and set a “buy” rating on the stock in a report on Thursday. Finally, Barclays reduced their price target on shares of Meta Platforms from $830.00 to $780.00 and set an “overweight” rating for the company in a research note on Thursday. Four research analysts have rated the stock with a Strong Buy rating, thirty-six have issued a Buy rating and eight have given a Hold rating to the stock. Based on data from MarketBeat, the company currently has an average rating of “Moderate Buy” and a consensus target price of $794.73.

Insider Buying and Selling at Meta Platforms

In related news, Director Robert M. Kimmitt sold 500 shares of the company’s stock in a transaction on Wednesday, July 1st. The stock was sold at an average price of $607.75, for a total transaction of $303,875.00. Following the completion of the sale, the director owned 3,443 shares in the company, valued at approximately $2,092,483.25. This represents a 12.68% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, COO Javier Olivan sold 837 shares of the stock in a transaction dated Monday, July 27th. The shares were sold at an average price of $607.85, for a total value of $508,770.45. Following the completion of the transaction, the chief operating officer directly owned 6,290 shares in the company, valued at approximately $3,823,376.50. This represents a 11.74% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 39,325 shares of company stock valued at $23,979,087 in the last ninety days. 13.53% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Meta Platforms

Institutional investors and hedge funds have recently made changes to their positions in the business. Keybank National Association OH raised its position in Meta Platforms by 15.7% during the fourth quarter. Keybank National Association OH now owns 133,798 shares of the social networking company’s stock valued at $88,319,000 after purchasing an additional 18,169 shares during the period. WMS Group LLC purchased a new position in shares of Meta Platforms in the 4th quarter worth approximately $876,000. Consolidated Investment Group LLC increased its position in shares of Meta Platforms by 61.2% during the 4th quarter. Consolidated Investment Group LLC now owns 7,900 shares of the social networking company’s stock valued at $5,215,000 after purchasing an additional 3,000 shares during the last quarter. Vanguard Group Inc. increased its position in shares of Meta Platforms by 3.8% during the 4th quarter. Vanguard Group Inc. now owns 199,995,630 shares of the social networking company’s stock valued at $132,015,115,000 after purchasing an additional 7,269,279 shares during the last quarter. Finally, Third View Private Wealth LLC purchased a new stake in Meta Platforms during the 4th quarter valued at $27,789,000. Hedge funds and other institutional investors own 79.91% of the company’s stock.

Meta Platforms Stock Down 8.0%

The company has a market cap of $1.36 trillion, a PE ratio of 19.59, a price-to-earnings-growth ratio of 0.99 and a beta of 1.25. The company has a fifty day moving average of $603.59 and a two-hundred day moving average of $624.24. The company has a debt-to-equity ratio of 0.24, a quick ratio of 2.35 and a current ratio of 2.35.

About Meta Platforms

Meta Platforms, Inc (NASDAQ: META), formerly Facebook, Inc, is a global technology company best known for building social networking services and immersive computing platforms. Founded in 2004 and headquartered in Menlo Park, California, the company operates a family of consumer-facing products and services that connect users, creators and businesses. In October 2021 the company rebranded as Meta to reflect an expanded strategic focus on augmented and virtual reality technologies alongside its social media businesses.

Meta’s core consumer products include Facebook, Instagram, WhatsApp and Messenger, which enable social networking, messaging, content sharing and community building across mobile and desktop devices.