In Q4 FY25, Meta Platforms reported a 7% year-over-year increase in daily active users, bringing its total to 3.58 billion. This milestone marks the fastest quarterly user growth rate the company has posted since Q2 FY24. Growth was particularly strong in Southeast Asia and Latin America, where DAUs climbed 9% and 8% respectively. The uptick underscores the resilience of Meta’s core social networks despite intensifying competition in short-form video and messaging apps.

Meta’s AI investments—chiefly its Lattice and GEM redistribution models—drove an 18% year-over-year jump in ad impressions during the quarter. By leveraging advanced sequence learning to optimize ad placement in real time, the company increased average daily auction participation by 12% without raising inventory. Advertisers reported up to a 15% improvement in return on ad spend in select verticals, highlighting the early success of AI-driven targeting at scale.

Instagram Reels continued to capitalize on AI-enhanced recommendation algorithms, delivering a 30% year-over-year increase in U.S. watch time for Q4. Meta attributes this surge to deeper interaction histories and improved content sequencing, which boosted average session length by nearly two minutes. Reels now account for over 35% of all time spent on Instagram, a key factor in maintaining user engagement and monetization momentum.

Since Meta’s Q3 FY25 earnings release in November, the stock has risen roughly 17%, significantly outperforming the broader market’s 4% gain over the same period. Investor confidence has been bolstered by the company’s ability to grow revenue per user even as it ramps up AI-related capital expenditures. With management forecasting further revenue acceleration from AI-enhanced products in 1Q26, analysts have largely raised full-year estimates, solidifying an Overweight consensus among major brokerages.