NEW YORK, December 31, 2025, 11:57 ET — Regular session
- Meta shares were down about 0.4% in late morning trade after a Reuters report on scam-ad tactics.
- A U.S. Virgin Islands lawsuit and fresh scrutiny of ad verification added to regulatory pressure.
- Investors are also weighing Meta’s planned $2–$3 billion acquisition of AI startup Manus.
Meta Platforms shares dipped on Wednesday after a Reuters investigation said internal documents showed the Facebook and Instagram owner developed a “global playbook” to fend off pressure to crack down on scammers and delay tougher checks on advertisers. Meta was down 0.4% at $663 by 11:57 a.m. ET, after closing at $665.95 on Tuesday. The documents said Meta estimated universal advertiser verification — an identity check before ads run — could cost about $2 billion to implement and reduce revenue by up to 4.8%, while Google has said it has verified more than 90% of advertisers. 1
The timing matters because governments are sharpening their focus on online fraud and how paid content is policed across social platforms. For Meta, any shift from voluntary controls to mandatory rules could add compliance costs and create friction for smaller advertisers.
Investors are also trying to square the regulatory overhang with Meta’s push to deepen its artificial intelligence offerings. The market has rewarded AI-driven growth stories, but the same period has raised questions about how much oversight and safety spending platforms will face.
On Tuesday, the attorney general of the U.S. Virgin Islands sued Meta in the territory’s Superior Court on St. Croix, accusing the company of profiting from advertisements for scams and failing to keep its platforms safe for children, the complaint said. Meta denied the allegations and said scam reports from users have fallen by half over the last 18 months. 2
The legal and regulatory headlines arrive just as Meta tries to keep investor attention on product expansion. Company executives have been pitching AI features as a way to improve ad performance and build new tools for consumers and businesses.
Meta said on Monday it would acquire Manus, a Chinese-founded AI startup now based in Singapore, in a deal valued at $2 billion to $3 billion, a source with direct knowledge told Reuters. Manus is best known for “AI agents,” software designed to take actions and complete tasks with less prompting than a standard chatbot. “We see a natural fit into Meta’s fast-growing, WhatsApp SMB footprint,” said Barton Crockett, an analyst at Rosenblatt Securities, using SMB to refer to small and medium businesses. 3
Meta shares had risen 1.1% on Tuesday after the Manus announcement helped lift communication services, even as the S&P 500 and Nasdaq closed slightly lower in choppy, holiday-thinned trade. Investors were also digesting Federal Reserve minutes, with the next policy meeting set for Jan. 27–28 and markets pricing in no change in rates, Reuters reported. 4
Broader risk appetite was muted on Wednesday, with Wall Street’s major indexes slipping in the final trading session of 2025 and technology shares extending recent losses. Trading volumes have been thinner than usual in the holiday-shortened week, and U.S. markets are closed on Thursday for New Year’s Day. 5
For META, the day’s pullback was modest, but it highlighted how quickly the stock can react to policy and safety-related headlines tied to its ad marketplace. Those issues are difficult for investors to model, because they can shift abruptly with new rules, investigations or court actions.
The other side of the ledger is Meta’s AI strategy, where investors are watching for products that can be monetized through advertising and business messaging. AI agents are a fast-moving category, and rivals including OpenAI and Alphabet are investing heavily in automation tools that can complete multi-step tasks.
Traders are now watching for any follow-on regulatory action around scam ads and advertiser identity checks, as well as any additional litigation tied to alleged platform harms. Progress updates on the Manus integration — and any signs that AI-related costs are accelerating — are also likely to be key drivers for Meta shares into the first trading sessions of 2026.
