Meta Platforms (META, Buy, $580 target) First Take: Strong 3Q revenue outlook carries the day
What’s New: In this first take following tonight’s results, we touch on:1. 3Q24 revenue guidance strong, driving stock up after hours
2. Four key near-term focuses for Gen AI development
• Gen AI ad creative tools are driving monetization already
• Meta AI advertising likely coming eventually, but perhaps 2025 is still too early
• Business messaging revenue could “dramatically accelerate”
• Growing core engagement, with Creator AIs from AI Studio leading the way
3. Expect 2025 Street CapEx to move up considerably, while FCF moves down
4. No change to 2024 OpEx guidance, but cautious commentary for 2025
5. Capital returns largely as expected
Facebook is building and engaging products that enable people to connect and share with friends and family through mobile devices, personal computers, virtual reality headsets, and in-home devices. The company's products include: Facebook, which enables people to connect, share, discover, and communicate with each other on mobile devices and personal computers; Instagram, which is a place where people can express themselves through photos, videos, and private messaging, and explore their interests in businesses, creators and communities; Messenger and WhatsApp, which are messaging applications; and Oculus, which connects people through its Oculus virtual reality products.
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