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Meta (META) reported fourth quarter earnings Wednesday that beat expectations while the company forecast a slowdown in revenue growth in the current quarter and said expenses in 2025 would grow faster than last year.
Shares of the company rose more than 4% in early trading on Thursday, reversing initial losses following the release of the results.
The social media giant reported fourth quarter earnings per share of $8.02 on revenue of $48.4 billion, higher than expectations for EPS to reach $6.75 on revenue of $46.9 billion, according to Bloomberg estimates.
For the full year, the company's net income totaled $62.4 billion, up 59% from the $39.1 billion seen last year.
In the first quarter, however, the company sees revenue coming in between $39.5 billion and $41.8 billion, reflecting 8%-15% growth from the prior year period. In the fourth quarter, revenue rose 21% over last year. For the full year 2024, revenue totaled $164.5 billion, up 22% over last year.
Meta also declined to offer a full-year revenue forecast, saying, "We expect the investments we are making in our core business this year will give us an opportunity to continue delivering strong revenue growth throughout 2025."
Wednesday's report comes less than a week after CEO Mark Zuckerberg announced Meta plans to spend between $60 billion and $65 billion on AI infrastructure projects this year, including the construction of a data center that the executive says is so large its footprint would cover a large chunk of Manhattan.
The company had previously projected $38 billion to $40 billion in capital expenditures in 2024, up from prior estimates of $37 billion to $40 billion.
Meta's announcement also follows a massive selloff in AI stocks on Monday fueled by Wall Street's fears of DeepSeek's claims that it produced an AI model that can compete with Silicon Valley's best for a fraction of the cost.
Zuckerberg, however, downplayed any concerns over the China-based company's offerings.
“I think there’s a number of novel things that they did that I think we’re still digesting, and there are a number of things that they have … that we will hope to implement in our systems,” he said.
In its release on Wednesday, CFO Susan Li said expenses for 2025 should fall in a range of $114 billion-$119 billion, up from $95.1 billion in 2024.
"We expect the single largest driver of expense growth in 2025 to be infrastructure costs, driven by higher operating expenses and depreciation," Li said.
"We expect employee compensation to be the second-largest factor as we add technical talent in the priority areas of infrastructure, monetization, Reality Labs, generative artificial intelligence (AI), as well as regulation and compliance."