Updated December 5, 2025
Key Takeaways
- Meta Platforms (NASDAQ: META) is trading around $660–$665 per share on Friday, December 5, 2025, up roughly 3–4% after a two-day rally. [1]
- The move follows reports of up to 30% budget cuts in the metaverse-focused Reality Labs division and a clearer pivot toward AI and core advertising businesses. [2]
- The board has declared a $0.525 quarterly cash dividend payable on December 23, extending Meta’s relatively new shareholder-return program. [3]
- Q3 2025 revenue hit a record $51.2 billion (+26% YoY), but a $15.9 billion one‑time tax charge slashed GAAP earnings; underlying non‑GAAP EPS was $7.25. [4]
- Management has lifted 2025 capital expenditure guidance to $70–72 billion, largely to fund AI data centers and infrastructure, raising both growth potential and execution risk. [5]
- Wall Street’s 12‑month price targets cluster around $830–$840, with some bulls above $900–$1,100, implying 30–70% potential upside from current levels. [6]
Meta Stock Today: Price, Performance and Valuation
As of early afternoon on December 5, 2025, Meta Platforms shares trade around $661.5 per share, giving the company a market capitalization in the $1.7–1.8 trillion range. [7]
- Market cap: ≈$1.7T–$1.8T
- 52‑week range: roughly $480 (low) to $796 (high) [8]
- Trailing P/E: around 29–32x, depending on data source [9]
- Institutional ownership: close to 80% [10]
Despite the recent rally, Meta stock still trades notably below its 2025 highs near the upper‑$700s, leaving room for upside if the AI strategy and cost discipline continue to regain investor confidence. [11]
Why Meta Is Rallying: Metaverse Cuts and an AI‑First Pivot
The immediate catalyst for this week’s move is a strategic reset of the metaverse bet.
Deep Cuts at Reality Labs
Multiple reports indicate that CEO Mark Zuckerberg is preparing budget cuts of up to 30% for Meta’s Reality Labs unit in the 2026 budget cycle. [12]
- Reality Labs, which houses Horizon Worlds and Quest VR, has reportedly racked up over $70 billion in cumulative losses since 2021. [13]
- The cuts could include layoffs as early as January 2026, and are being framed as part of a broader push to rein in spending on low‑return metaverse projects. [14]
Coverage from outlets including the Economic Times and MarketMinute describes a market reaction where Meta shares jumped around 4–7% on Thursday as investors welcomed a more disciplined approach to the company’s most controversial investment area. [15]
AI Becomes the Clear Center of Gravity
At the same time, Meta is accelerating AI investment to an unprecedented scale:
- Management has raised 2025 capex guidance from $66–72 billion to $70–72 billion, explicitly to fund AI data centers and hardware. [16]
- MarketMinute reports plans for over 2 million GPUs by 2026 and positions Meta as an “AI‑first” company, with Reality Labs spending refocused on AI‑powered AR and smart glasses rather than blue‑sky metaverse worlds. [17]
This pivot is being read as Meta trading some speculative metaverse optionality for nearer‑term AI monetization, especially in advertising, where AI‑driven targeting and recommendation systems are already driving revenue growth.
New Dividend: Meta Leans Into Shareholder Returns
On December 3, 2025, Meta’s board declared a quarterly cash dividend of $0.525 per share on both Class A and Class B stock, payable December 23, 2025 to shareholders of record as of December 15, 2025. [18]
At current prices, that equates to:
- Annualized dividend: about $2.10 per share
- Dividend yield: roughly 0.3%
- Payout ratio: around 9% of earnings, according to MarketBeat. [19]
Spanish financial daily El País notes that the dividend is being maintained while Meta simultaneously cuts metaverse spend and increases capex, framing the move as part of a package aimed at “re‑winning” investor trust. [20]
The dividend is modest in yield, but symbolically important: Meta is signaling that cash returns to shareholders are now a permanent fixture, not just buybacks. That matters for large, income‑oriented funds that previously ignored the stock.
Under the Hood: Q3 2025 Results Show Strong Core, Distorted GAAP Earnings
Meta’s Q3 2025 earnings, released October 29, are the backdrop for today’s debate about AI spending and valuation.
Headline Numbers
According to Meta’s own earnings release and independent analyses: [21]
- Revenue: $51.24 billion, +26% year‑over‑year, a new record
- Operating income: $20.5 billion, 40% operating margin
- GAAP net income: $2.7 billion
- GAAP EPS: $1.05 (down sharply vs. last year)
- Non‑GAAP EPS (excluding tax hit): $7.25, up about 19–20% YoY
The apparent collapse in GAAP earnings is almost entirely due to a $15.93 billion non‑cash tax charge tied to the new U.S. corporate tax rules under the so‑called “One Big Beautiful Bill Act.” Excluding that, Meta’s underlying profitability remains very strong. [22]
User and Ad Metrics
Meta’s advertising engine continues to look formidable: [23]
- Family Daily Active People (DAP): 3.54 billion, +8% YoY
- Ad impressions: up 14% YoY
- Average price per ad: up 10% YoY
Q3 Family of Apps revenue (Facebook, Instagram, Messenger, WhatsApp and Threads) reached about $50.8 billion, up 26%. Reality Labs revenue, while still small, grew to around $470 million, helped by Quest headset shipments and AI‑enabled smart glasses. [24]
Cash Flow, Balance Sheet and Capex
Meta is leaning hard into AI infrastructure:
- Q3 2025 capex: about $19.4 billion (servers, data centers, networking).
- Free cash flow: roughly $10.6 billion in the quarter.
- Cash & marketable securities: about $44.4 billion vs $28.8 billion in debt. [25]
The company also:
- Repurchased ~$3.2 billion of stock and
- Paid $1.3 billion in dividends in Q3 alone. [26]
In parallel, El País reports Meta has issued $30 billion of bonds and secured $27 billion of data‑center financing, further emphasizing the scale of the AI build‑out. [27]
Management guides Q4 2025 revenue to $56–59 billion, implying high‑teens to mid‑20s percent growth, driven largely by ad demand and AI‑enhanced ad performance. [28]
Wall Street Targets and Long‑Term Forecasts
Opinion on the stock remains broadly positive, though not unanimous.
12‑Month Price Targets
24/7 Wall St., citing aggregated analyst data, puts the current median one‑year price target for Meta at about $838 per share, implying roughly 30% upside from the low‑$660s. [29]
Other key points from recent research roundups: [30]
- Coverage ranges from dozens of large banks and brokers.
- Consensus rating is “Buy” to “Strong Buy”, depending on the dataset.
- High target: around $1,100+ per share.
- Low target: mid‑$600s, near current trading levels.
- Individual houses have set targets like $875–$920 (various Wall Street firms) and around $900+ in some bullish calls.
24/7 Wall St.’s own model forecasts Meta shares could reach about $875 within a year (≈37% upside) if strong ad growth continues and AI investments translate into margin expansion over time. [31]
Longer‑Term Outlook
In a separate deep‑dive, 24/7 Wall St. projects roughly 73% upside through the end of the decade, based on assumptions about: [32]
- Continued dominance in digital advertising
- Incremental revenue from AI assistants (Meta AI), Llama models and AI services
- Gradual scaling of AR/AI glasses and more targeted metaverse/“spatial computing” uses
These are, of course, speculative forecasts, but they underscore that Wall Street largely views Meta as a long‑duration AI and data play, not just a social‑media ad platform.
Other Major News Meta Investors Are Watching
1. AI Content Deals With Publishers
On December 5, Reuters reported that Meta has struck several commercial AI data licensing deals with major news publishers, including USA Today, People Inc., CNN, Fox News, The Daily Caller, Washington Examiner and Le Monde. [33]
In a related PR, People Inc. (IAC) said it has become Meta AI’s first lifestyle content partner, providing real‑time content across brands such as PEOPLE, Better Homes & Gardens, Allrecipes, Food & Wine, Southern Living, Verywell Health and InStyle. [34]
These agreements:
- Expand the content corpus available to Meta’s AI products.
- Help address copyright and attribution concerns by paying and crediting publishers.
- Reinforce the view that Meta plans to monetize AI not just as a feature, but as a platform for information discovery and advertising.
2. Regulatory Pressure: Spain’s Privacy Probe and EU Scrutiny
Regulatory risk remains a key overhang.
On November 19, Spain announced a formal investigation into Meta over alleged “hidden” tracking of Android users, based on research from European institutions. Authorities say Meta may have violated: [35]
- The GDPR (data protection)
- The ePrivacy Directive
- The Digital Markets Act (DMA)
- The Digital Services Act (DSA)
Potential GDPR fines can reach up to 4% of global annual revenue, which is material for a company with over $50 billion in quarterly sales. [36]
In parallel, coverage of Meta’s AI strategy notes growing EU concerns about data usage, AI integration into WhatsApp and other apps, and Meta’s stance on new AI codes of practice, suggesting more friction ahead in Europe. [37]
3. Institutional Flows and ARK’s Exit
Recent filings and commentary highlight mixed but generally constructive institutional activity:
- Columbus Hill Capital Management increased its Meta stake by 10.7% in Q2, making META about 8% of its portfolio and its third‑largest holding. [38]
- Strategy Capital LLC trimmed its position by about 25%, but Meta still represents over 8% of its holdings and remains a top‑five position. [39]
- An analysis from CoinCentral notes Cathie Wood’s ARK Invest sold around 14,200 Meta shares (~$9.1M) on December 4 while rotating into The Trade Desk, suggesting some high‑profile growth investors see better risk‑reward elsewhere in ad tech at current prices. [40]
Overall, institutional ownership remains near 80%, indicating continued conviction among large asset managers. [41]
Investment Case: Opportunities vs. Risks
This is not investment advice, but for readers assessing Meta stock, the current setup revolves around a few big swing factors.
Bullish Arguments
- Dominant Ad Platform + AI Upside
Meta’s Family of Apps still command unmatched reach, with more than 3.5 billion people using at least one app daily and ad pricing and impressions both growing. AI‑driven targeting and recommendations are already boosting engagement and revenue. [42] - AI Infrastructure Scale and Open‑Source Advantage
Massive capex and open‑source Llama models position Meta as a top‑tier frontier AI lab, with potential monetization through better ads, consumer AI assistants, enterprise tools and licensing. [43] - Robust Balance Sheet and Cash Generation
Tens of billions in cash, strong free cash flow and relatively modest leverage give Meta room to invest aggressively while funding buybacks and dividends. [44] - Valuation vs. Growth
Trading around high‑20s to low‑30s earnings multiples with mid‑20s revenue growth and strong margins, many analysts view Meta as cheaper than several Magnificent Seven peers given its growth trajectory. [45]
Bearish / Risk Factors
- AI Capex and Execution Risk
Raising capex to $70–72B in 2025 is a massive bet. If AI returns disappoint, investors may punish the stock for years of heavy spending. [46] - Regulatory and Political Risk
Spain’s probe and broader EU scrutiny of Meta’s data and AI practices highlight ongoing headline and fine risk, which could pressure margins or constrain product rollouts. [47] - Metaverse Overhang and Strategy Whiplash
While cuts to Reality Labs are being applauded now, the sudden reversal from the all‑in metaverse push underlines that Meta’s strategy can change quickly, which some investors see as a governance risk. - Competition in AI and Social
Meta faces fierce competition from OpenAI, Google, Microsoft, Anthropic, xAI and others in AI, plus ongoing rivalry from TikTok, YouTube and X in social and short‑form video. [48]
What to Watch Next
For investors following Meta stock into year‑end and 2026, key upcoming catalysts include:
- Q4 2025 earnings (early 2026):
Whether revenue lands toward the high end of the $56–59B guidance range and how AI‑driven ad products perform. [49] - Updated capex and AI roadmap:
Any further revisions to 2026–2027 capex, GPU plans and AI product monetization paths. - Regulatory developments:
Outcomes from Spain’s privacy probe, any new fines or remedies from EU regulators, and how Meta adapts its AI products in Europe. [50] - Publisher and partner ecosystem:
How the new AI licensing deals with news and lifestyle publishers translate into better AI experiences – and whether more partners join. [51]
If Meta successfully threads the needle—dialing back metaverse losses, converting massive AI capex into durable revenue, and managing regulatory risk—it has room, according to current analyst forecasts, for significant upside from today’s levels. But the scale of the AI bet means the margin of error is small, and volatility is likely to remain high.
References
1. www.marketbeat.com, 2. m.economictimes.com, 3. investor.atmeta.com, 4. www.prnewswire.com, 5. www.reuters.com, 6. 247wallst.com, 7. www.marketbeat.com, 8. www.marketbeat.com, 9. www.marketbeat.com, 10. www.marketbeat.com, 11. 247wallst.com, 12. m.economictimes.com, 13. m.economictimes.com, 14. m.economictimes.com, 15. m.economictimes.com, 16. www.reuters.com, 17. markets.financialcontent.com, 18. investor.atmeta.com, 19. www.marketbeat.com, 20. elpais.com, 21. www.prnewswire.com, 22. www.prnewswire.com, 23. www.prnewswire.com, 24. www.alpha-sense.com, 25. www.alpha-sense.com, 26. www.alpha-sense.com, 27. elpais.com, 28. www.prnewswire.com, 29. 247wallst.com, 30. www.marketbeat.com, 31. 247wallst.com, 32. 247wallst.com, 33. www.reuters.com, 34. www.stocktitan.net, 35. coincentral.com, 36. coincentral.com, 37. markets.financialcontent.com, 38. www.marketbeat.com, 39. www.marketbeat.com, 40. coincentral.com, 41. www.marketbeat.com, 42. www.prnewswire.com, 43. www.alpha-sense.com, 44. www.alpha-sense.com, 45. markets.financialcontent.com, 46. www.reuters.com, 47. coincentral.com, 48. www.reuters.com, 49. www.prnewswire.com, 50. coincentral.com, 51. www.reuters.com
