Meta's Q1 FY25 results showed a 6% year-over-year (Y/Y) increase in daily active users, totaling 3.43 billion. Ad impressions rose by 5% Y/Y, contributing to a 16% Y/Y revenue increase, reaching $42.3 billion, which exceeded expectations by $1.0 billion. The operating margin improved to 41%, up 4 percentage points (pp) Y/Y, while earnings per share (EPS) were reported at $6.43, beating estimates by $1.21.
The company experienced a 37% increase in EPS compared to Q1 2024, with analysts predicting revenues of $41.4 billion and an EPS of $5.28. Meta's CEO, Mark Zuckerberg, highlighted the company's strong performance and growth in its user base. Following the earnings report, Meta's stock rose by approximately 4.1% in after-hours trading.
Looking ahead, Meta anticipates Q2 revenues between $42.5 billion and $45.5 billion and has adjusted its capital expenditure forecast to $64-$72 billion to support AI investments and infrastructure costs.
However, Meta faces challenges from EU regulations, as the European Commission's ruling on its advertising model may significantly impact operations starting in Q3. The commission imposed a €200 million fine for non-compliance with data consent requirements, leading Meta to anticipate necessary modifications that could degrade user experience for European users.
