Meta Shares Surge After Strong Earnings Report

Meta Platforms is once again at the center of Wall Street’s attention after delivering its fourth-quarter earnings report on January 28, 2026—a performance that sent shockwaves through the market and left investors both elated and contemplative. The company, which has long been a bellwether for the tech sector, saw its shares surge nearly 9% in after-hours trading, according to multiple sources including Barron’s and MarketWatch. This jump marked Meta’s best single-day gain since July 31, 2025, when the stock rocketed 11.3% on a closing basis.

The drama of the day was palpable. Immediately after the earnings were announced, Meta’s stock actually dipped by as much as 5.3%, a knee-jerk reaction that had some investors briefly sweating. But the mood quickly reversed, and by the end of after-hours trading, the stock was up 8.9%, as reported by MarketWatch. This whiplash move was a vivid reminder of how volatile big tech earnings can be—and how much is riding on every quarterly update.

The numbers behind the excitement paint a picture of a company firing on most cylinders, but not without its share of challenges. Meta’s reported results were described as “solid” by Barron’s, and the after-hours rally was a clear signal that investors liked what they saw. Yet, as the confetti settled, a more nuanced reality emerged: Meta’s expenses are mounting, and the company is spending at a pace that rivals any of its peers.

Heading into the Q4 2025 call, investor anticipation was already running hot, as noted by TipRanks. Meta had guided capital spending for 2025 at a staggering $70–72 billion—a figure that cements its status as one of the market’s heaviest spenders, particularly on artificial intelligence (AI) and infrastructure. The sheer scale of this investment has fueled both optimism and anxiety. On one hand, tech leaders are touting a future powered by AI: think autonomous cars, intelligent robots, and always-on digital assistants. On the other hand, many of these opportunities remain more promise than profit, at least for now.

So, what’s the real test for Meta at this juncture? According to TipRanks, it’s all about investor patience. While few doubt that AI will eventually change the game, there’s plenty of skepticism about whether companies outside the semiconductor and cloud computing sectors can truly monetize this revolutionary technology. That’s where Meta may just have an edge.

Top investor Adam Spatacco, ranked among the top 2% of stock professionals tracked by TipRanks, argues that Meta has “one of the clearest ways to showcase how AI is already making a positive impact on its business.” Spatacco points specifically to Meta’s AI “advertising empire,” which is already bringing in substantial revenue. He explains, “The company is using machine learning to analyze its enormous quantities of consumer data, effectively allowing brands to ‘take the guesswork’ out of advertising campaigns.”

Central to this success is Meta’s AI-powered advertising platform, Advantage+. Since its launch three years ago—around 2023—Advantage+ has been operating at a $60 billion annual revenue run rate. “Few developers and infrastructure spenders can reference a similar growth trajectory directly tied to AI,” Spatacco emphasizes. This achievement doesn’t just boost Meta’s top line; it also raises the cost for customers to switch platforms, which, in turn, helps retain clients and could pave the way for higher prices down the road.

Yet, for all its AI prowess, Meta’s valuation is relatively modest compared to its tech-giant peers. As of January 28, 2026, the company’s forward price-to-earnings multiple stood at 22x, making it the cheapest among the so-called Magnificent Seven. This raises a curious question: Why isn’t the market rewarding Meta with a richer valuation?

Spatacco suggests that lingering doubts about Meta’s leadership—particularly in light of CEO Mark Zuckerberg’s much-publicized metaverse missteps a few years back—may be holding the stock back. “The market simply doesn’t trust Meta’s leadership to effectively allocate capital,” he notes. Still, Wall Street’s broader view is notably more bullish. The consensus rating for Meta is a resounding Strong Buy, with 38 Buys, 6 Holds, and just 1 Sell, according to TipRanks. The 12-month average price target sits at $821.11, implying potential gains north of 20% from current levels.

For investors, the debate is far from settled. On one side, you have the optimists who see Meta’s heavy spending as a bold bet on the future—a future where AI-driven services will dominate not just advertising, but possibly every facet of digital life. On the other side, the skeptics worry that the company’s ballooning expenses could outpace the profits, especially if some of those big AI dreams don’t materialize as quickly as hoped.

It’s worth noting that Meta’s approach to AI isn’t just about abstract promises. Its machine learning systems, deployed across its vast social platforms, are already making a tangible difference for advertisers. By leveraging the data generated by billions of users, Meta can offer brands highly targeted campaigns, reducing waste and boosting returns. This, in turn, makes the platform stickier for advertisers, as switching to a rival would mean losing out on these AI-driven insights.

Still, not everyone is convinced. The shadow of past missteps, especially the metaverse project that failed to ignite as Zuckerberg had hoped, looms large. Critics argue that Meta’s leadership has at times been too eager to chase the next big thing, risking shareholder capital in the process. The balance between visionary investment and prudent management remains a delicate one.

Yet, with Wall Street’s consensus firmly in the company’s corner—and with Advantage+ providing a real-world example of AI’s profit potential—Meta seems better positioned than many of its peers to weather the current tech storm. As Spatacco puts it, “In my eyes, Wall Street is right to be so bullish on Meta stock.”

As Meta looks ahead to the rest of 2026, the stakes couldn’t be higher. The company’s willingness to spend big on AI and infrastructure could either cement its dominance or leave it vulnerable if those investments fail to deliver. For now, though, investors seem willing to give Meta the benefit of the doubt, buoyed by strong earnings, a robust advertising business, and the tantalizing promise of an AI-powered future.

Time will tell if Meta’s bold bets pay off, but one thing is certain: the company’s latest earnings have reignited the debate about risk, reward, and the true value of innovation in the tech sector.