NEW YORK, July 22, 2026, 19:09 EDT
- Meta shares ended the session at $627.17, falling 2.6%. The stock has dropped 8.0% across the past five sessions.
- The guidance indicates average capital expenditure of $38.39 billion for Q2-Q4, which is 94% higher than in Q1.
- Meta will report its second-quarter earnings after the closing bell on July 29.
Meta Platforms, Inc. NASDAQ:META will have to almost double its average quarterly capital expenditures rate in line with the midpoint of its 2026 outlook.
The main Nasdaq session ended before the dateline. Trading after hours was still ongoing.
The stock closed at $627.17, falling 2.6%. Over five sessions, losses totaled 8.0%.
Capital expenditures reached $19.84 billion in the first quarter. The company projects total spending for the year at between $125 billion and $145 billion.
The midpoint of $135 billion puts the post-Q1 need at $115.16 billion. This signals a required $38.39 billion per quarter for the rest of the year, a rise of 94% compared to Q1.
Just 14.7% of midpoint spending was disclosed in Q1. The July 29 report will reveal how much that rate accelerated.
Meta’s free cash flow provides a substantial buffer, though it is not without limits. In Q1, the company generated $12.39 billion in free cash flow.
Alphabet Inc. NASDAQ:GOOGL underscored the sector’s risk following Wednesday’s close, lifting its 2026 capital expenditure outlook to a range of $195 billion to $205 billion.
Google Cloud recorded an 82% increase in revenue. Meanwhile, Alphabet posted a negative quarterly free cash flow of $5.9 billion. Shares declined by almost 5% in after-hours trading.
Alphabet CFO Anat Ashkenazi stated, “The demand still outpaces that investment.” The implication remains cautious: strong demand may not be sufficient to secure near-term cash flow. Reuters
Meta’s overall budget for spending is still lower, but relative to its current revenue, the burden is greater.
| Company | 2025 revenue | 2025 capex | 2026 capex midpoint* | Midpoint / 2025 revenue | Capex change vs 2025 |
|---|---|---|---|---|---|
| Meta Platforms | $201.0bn | $72.2bn | $135.0bn | 67% | +87% |
| Alphabet | $402.8bn | $91.4bn | $200.0bn | 50% | +119% |
2026 numbers represent midpoint guidance, not realized expenditures. Meta factors in finance-lease principal, with each firm applying its own criteria. Amounts refer to overall infrastructure, not just AI spending.
Meta’s midpoint represents 67% of its projected 2025 revenue, while Alphabet’s comparable figure stands at around 50%. As a result, Meta exhibits a higher spending intensity even though its overall budget is smaller.
Some investors remain optimistic about spending. Rothschild & Co Redburn analyst Dominic Ball increased his price target to $1,000 from $900 and maintained a Buy recommendation.
Meta’s ad business backs up the optimistic outlook. Revenue for Q1 was up 33%. The number of ad impressions grew 19%, and the average ad price advanced by 12%.
Initial external projections point to quarterly revenue of $60.21 billion, with consensus EPS forecasts ranging from $7.19 to $7.20. Meta’s revenue outlook is $58 billion to $61 billion.
Results are set to be released following the market’s close on July 29. The conference call begins at 4:30 p.m. ET. Investors will scrutinize Q2 capital expenditures, advertising growth for the second half, and the trajectory of free cash flow.
Risks: A Florida teenager on Wednesday withdrew a Meta lawsuit without settlement. Over 3,300 comparable cases are pending in California state court and 2,600 more at the federal level. Meta has warned that legal challenges relating to young users could lead to significant financial loss.
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