Meta's Strong Q1 Results on Robust Ad Sales Ease Tariff-Induced Fears

Meta Platforms on April 30 rode on a strong advertising performance to beat analysts' revenue estimates for the first quarter and match expectations for the next quarter, assuaging investor concerns over tariff-related economic growth fears.

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The parent of Facebook and Instagram also increased planned capital expenditures in 2025 as it speeds up construction of data centers that can support artificial intelligence (AI), which it sees bolstering and transforming its business.

Meta shares were up 5 percent in extended trading. The company boosted its 2025 capital expenditure plans to between US$64 billion (S$83.7 billion) and US$72 billion. Chief executive Mark Zuckerberg previously said it could spend as much as US$65 billion in 2025.

"The pace of progress across the industry and the opportunities ahead for us are staggering. I want to make sure that we're working aggressively and efficiently, and I also want to make sure that we are building out the leading infrastructure and teams," Mr. Zuckerberg told investors on a call after publishing results.

Meta executives said most of the total capital expenditure is going towards supporting the core business, such as supplying the computing power for ads, rather than generative AI development.

But chief financial officer Susan Li said on the call that the increase to the forecast reflected a decision to more rapidly ready data center capacity in support of AI efforts, as well as the potential for tariffs to increase hardware export costs.