"This year, one of the better performers among the Magnificent 7 had been Meta Platforms Inc. ( NASDAQ: META). But its third-quarter earnings report raised investor concerns about the company's massive capital spending on artificial intelligence initiatives. In addition, a report from Reuters suggested that a significant portion of Meta's revenue comes from fraudulent ads. The stock is down 15.4% since the quarterly report was released."
"Strong quarterly reports earlier this year (despite a tax charge) had lent credence to the claim that Meta would continue to outshine its competitors over the next year. The share price hit an all-time high of $796.25 back in August. Even with the recent pullback, the stock is up 11.1% year over year. However, the near-term future of the economy is uncertain-just like the markets themselves-and Meta Platforms CEO Mark Zuckerberg is a controversial figure."
Meta Platforms showed strong performance among the Magnificent 7 but a third-quarter earnings report raised concerns about heavy AI capital spending and a Reuters report alleging substantial revenue from fraudulent ads. The stock dropped 15.4% after the report but remains up 11.1% year over year and reached an all-time high of $796.25 in August. Economic uncertainty and controversy around CEO Mark Zuckerberg’s metaverse pivot weigh on sentiment. Reality Labs produced $470 million in Q3 revenue but recorded a $4.43 billion operating loss, reducing prospects for near-term growth from the metaverse.
Read at 24/7 Wall St.
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