Meta reported a blowout first quarter on Wednesday, but investors weren't in a celebrating mood. Despite revenue and profit crushing expectations, the company's stock slid 5% in after-hours trading — a classic sign that Wall Street is laser-focused on what's coming next: a jaw-dropping capital expenditure hike and another round of layoffs.
Revenue hit $56.31 billion, up 33% year over year and ahead of the $55.45 billion analysts were expecting. Net income came in at $26.77 billion, a 61% jump. Mark Zuckerberg was characteristically ambitious: "We had a milestone quarter, with strong growth across all our apps and the release of the first model from Meta Superintelligence Labs. We're steadily moving toward our goal of providing personal superintelligence to billions of people."
But the numbers that moved the market were forward-looking. Meta now expects 2026 capital expenditures between $125 billion and $145 billion, up from a previous range of $115 billion to $135 billion. Total 2026 spending is projected at $162 billion to $169 billion. That's a lot of cash going into AI infrastructure, and investors are uneasy about the returns.
Related: Meta's revenue beats, but capital spending hike sends stock down 7%
Earnings per share came in at $10.44, but that includes a one-time tax benefit from the Trump administration's "One Big Beautiful Bill Act." Adjusted EPS was $7.31, still above the $6.66 analysts expected. The company also revealed it's cutting about 8,000 jobs — roughly 10% of its workforce — starting May 20, as part of a broader effort to become more efficient while pouring money into AI. Meta will also stop filling 6,000 vacant positions.
That's the second major round of layoffs in less than a year, following cuts in early 2026.
As of March 31, Meta employed 77,986 people, up 1% year over year — but that count doesn't include the upcoming layoffs. The company's apps — Facebook, Instagram, WhatsApp — saw daily active users grow 4% year over year to 3.56 billion, though that's a slight dip from 3.54 billion three months ago. Meta blamed the decline on "an internet shutdown in Iran and restrictions on WhatsApp access in Russia."
Zuckerberg has long bet the company's future on AI, including a $14.3 billion investment in Scale AI and hiring its CEO Alexandr Wang. The New York Times recently reported that Zuckerberg believes AI will eventually replace most tech industry workers. For now, Meta is walking a tightrope: spending heavily on AI while cutting human jobs to pay for it.