"UBS's bull case rests on a straightforward premise. GenAI is making Meta's advertising platform meaningfully better, and the financial results are beginning to reflect that in compounding ways."
"In the fourth quarter report of 2025, Meta's ad impressions rose 18% year over year while average price per ad climbed 6%. Those two numbers, moving together, volume and pricing, is the combination that drives revenue leverage."
"In Q4, we launched a new runtime model across Instagram Feed, Stories, and Reels, resulting in a 3% increase in conversion rates in Q4. We continue to progress on our model unification efforts under Lattice as well."
UBS increased its price target for Meta Platforms from $872 to $908, maintaining a Buy rating due to strong AI-driven advertising growth. Meta reported 2025 revenue of $200.97 billion and 3.58 billion daily active users. The bank's bullish outlook contrasts with Bank of America's reduced target of $820, highlighting differing views on Meta's AI potential. Risks include high capital expenditures in 2026, losses in virtual reality, and regulatory challenges. Meta's ad impressions rose 18% year over year, with a 6% increase in average ad prices, indicating revenue growth.
Read at TheStreet
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