Meta beats Q1 revenue and EPS estimates; AI boosts ad tools, but capex and buyback pause raise caution.

Meta Platforms reported strong Q1 results, surpassing revenue and earnings per share expectations, with operating margins steady at 41% despite a 35% rise in expenses. The company's AI investments are showing clear returns, notably through products like Lattice and GEM, which have doubled ad conversion rates and monetization run-rates. However, Meta significantly increased its capital expenditure guidance, committing $107 billion through 2027, and paused share buybacks in Q1, signaling potential risks. The analyst maintains a Buy rating with a $748 price target but recommends an Accumulate stance due to evolving capex risks and a cautious outlook.