"Meta was desperately in need of a new direction three years back. The company's Family of Apps segment (which comprises Facebook, Instagram, WhatsApp, and Messenger) started to slow down sharply. These apps were cash cows, but the market demanded growth. META stock tumbled below $90 as user growth started turning negative. Zuckerberg turned to Reality Labs to fuel growth, but Wall Street wasn't buying it. Analysts saw it as a money pit where the Family of Apps' cash was being squandered ."
"The stock fell from a peak close near $785 to a trough below $600. It has since recovered to nearly $650 but has been flat in the past six months. As one of the handful of companies spearheading the AI buildout, a sideways trend in the stock market for this long can be a clue that the market wants to see results before slapping a higher premium on the stock."
Meta has dramatically recovered since late 2022 after an AI-focused strategy led by Mark Zuckerberg reversed earlier declines. The stock surged past many bullish forecasts, peaked near $785, dropped below $600, and recovered toward $650 but remained flat for six months. Persistent sideways trading suggests investors demand clearer proof of sustainable results before assigning a higher valuation. The company shifted away from slowing Family of Apps growth and heavy Reality Labs skepticism toward large AI investment. Meta plans up to $72 billion in AI spending for 2025 and reported Q3 2025 revenue of $51.24 billion, up 26.2% year-over-year, beating estimates.
Read at 24/7 Wall St.
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