Meta's Ad Business Is Booming, But One Analyst Says The Real Story Is A $100 Billion AI Bet

Author: Anusuya Lahiri | October 28, 2025 01:37pm

Meta Platforms Inc‘s (NASDAQ:META) robust advertising tech and artificial intelligence infrastructure will deliver another strong quarter, one analyst says.

But it’s a pricey plan. The parent company of Facebook plans to spend $100 billion by 2026 to expand data centers and AI capabilities.

Rosenblatt‘s Barton Crockett maintained a Buy rating on Meta with a price forecast of $1,086.  

Also Read: Meta Bets Big On AI: Ad Revenue Set To Outpace Google

Crockett cited strong advertising momentum and continued investment in AI infrastructure as key growth drivers.

The analyst expects:

• Meta's third-quarter 2025 results to come in near the high end of guidance.
• Revenue of $49.4 billion, up 22% year over year.
• Earnings per share (EPS) of $6.69, roughly in line with Wall Street consensus.
• Revenue growth to moderate slightly to 18% year over year in the fourth quarter
• $66–$72 billion in capex for 2025, a more than 70% increase from 2024, and as much as $100 billion by 2026.
• Free cash flow is expected to fall from $52.1 billion in 2024 to $40.4 billion in 2025 and $32.2 billion in 2026.

Investors will tolerate these spending levels, Crockett says. That’s due to Meta's sustained high-teens to low-20% revenue growth trajectory, along with its generative AI and advertising technology.

He pointed to Meta's $22 billion in third-party financing for its 5-gigawatt Hyperion data center in Louisiana as a strategic move that could influence its capital outlook while supporting long-term expansion.

In his broader industry view, Crockett noted that the digital ad market remains resilient, supported by shifts toward programmatic advertising, connected TV, and generative AI tools.

Despite consumer spending concerns, the analyst says Meta and Alphabet are best positioned among large-cap tech names this earnings season.

The price forecast reflects confidence in Meta's ability to maintain a 20%+ EBITDA compound annual growth rate (CAGR) driven by AI innovation.

Price Action: Meta stock was trading lower by 0.36% to $729.51 at last check on Tuesday.

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Posted In: GOOGL META