Jan. 29 at 5:34 PM
In our view
$META is the leader in AI.
They combine massive global scale with deep, multimodal data and the ability to deploy innovation directly into products used by billions of people every day. Its advantage is the closed-loop system it operates across engagement, monetization, and measurement, allowing improvements in AI to translate quickly into real economic outcomes. The company’s willingness and capacity to invest through cycles, while continuously consolidating and improving its model architecture, gives it a durable edge that is difficult for peers to replicate.
This quarter really came down to one thing for me:
is Meta’s multi year AI investment finally showing up in the core business? The answer is yes.
Q4 revenue came in above the high end of guidance, and more importantly, that strength carried straight into Q1. At the midpoint, Meta is guiding to ~30% Y/Y revenue growth. That level of growth on a 200 billion run rate is very significant. They are growing twice as face as Microsoft, Google, Netflix, Amazon.
...and checks pointed to some of the largest ROIC gains on ads in the quarter. See our Investing with Data Newsletter, where we have shared those notes. But that lines up with what we’re seeing in the numbers.
User growth continues as well. The already massive base grew ~7% Y/Y to over 3.5B family of app monthly users.
There was plenty of focus on higher spend. FY26 OpEx and CapEx guides came in well above expectations, with CapEx growth implied at roughly ~80%. But what stood out to me was management explicitly acknowledging that this spend isn’t just about advertising. There are newer products on the roadmap that are broader in scope and likely years away from scaling.
The easy takeaway is that Meta is winning. AI is already supercharging the core business.
There’s been a lot of focus on Nvidia, and that makes sense. But the reality is Nvidia needs companies like Meta to be wildly successful for its own story to work. Meta, on the other hand, doesn’t need Nvidia specifically to win.
If Nvidia, or the broader chip ecosystem, plateaus in performance, Meta can still compound. Its advantage comes from scale, data, model architecture, and how efficiently it deploys AI into real products. Compute helps, but it’s not the only lever.
That asymmetry is important. Meta’s upside is driven by execution and unit economics, not just faster silicon.
Great quarter Zuck.
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