"Meta Platforms didn't have a bad 2025, as its stock rose around 13%. Still, that trails the S&P 500 , as it delivered 16% gains in 2025. However, Meta could have handily outperformed the market if its third quarter earnings report hadn't been so poorly received by the market. That caused the stock to drop in October, and shares haven't recovered since."
"Meta Platforms is the parent company of social media sites like Facebook, Instagram, and Threads. None of these platforms costs any money to use, and when something is free to use, you are the product. All of these platforms generate revenue through advertising income -- a business model that's becoming even more sophisticated with the integration of artificial intelligence (AI)."
"During Meta's Q3 earnings call, founder and CEO Mark Zuckerberg discussed the huge gains the company is seeing by implementing generative AI. Its numbers indicate users are spending 5% more time on Facebook and 10% on Threads. He highlighted videos on Instagram being watched 30% more this year than last. The more time users spend on these platforms, the more ads they are exposed to, increasing Meta's revenue."
Meta Platforms' stock rose about 13% in 2025, trailing the S&P 500's roughly 16% gain. A poorly received third-quarter earnings report triggered an October selloff, leaving shares about 16% below their all‑time high and creating a potential buying opportunity if the decline was short‑sighted. Meta's ad business is driving performance as free social platforms monetize through advertising enhanced by generative AI. User engagement rose — about 5% on Facebook, 10% on Threads, and Instagram video views roughly 30% year‑over‑year — increasing ad exposure and revenue. In Q3 overall revenue climbed 26%, with roughly $50 billion of $51.2 billion from advertising.
Read at The Motley Fool
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