In the week leading up to Meta’s fourth-quarter earnings release on January 28, Wall Street strategists collectively raised revenue forecasts by 150 basis points to a 21% year-over-year increase, placing consensus revenue at approximately $58.4 billion. Earnings‐per‐share expectations were bumped to $8.17, driven by stronger-than-anticipated ad engagement in North America and Europe. Analysts at Morgan Stanley and Bank of America each lifted their price targets by 10%–15%, citing improved ad load management and rollout of AI-powered ranking systems that boosted average revenue per user by an estimated $0.35 in the quarter.

Meta’s accelerated investment in data center capacity and AI compute is set to push full-year capital expenditures above $100 billion for 2026, up from $72 billion in 2025. Operating expenses rose by 24% in Q3 to $18 billion, reflecting increased spending on AI talent and server procurement. Management has indicated that Q4 depreciation and amortization will climb by at least 30% year over year as new infrastructure comes online. While these investments underpin longer-term growth in AI-driven ad targeting, they subtract an estimated $0.50 from expected Q4 EPS in the near term.

Meta inked a $6 billion long-term agreement with Corning in Q3 to supply advanced optical fiber and connectivity components for its next-generation AI data centers. Under the pact, Meta will anchor Corning’s expanded North Carolina facility, which is being outfitted to produce more than 40 million fibers per month. This deal secures capacity for Meta’s planned data center expansions, supporting projected AI workloads that are expected to double annually through 2027. The agreement also diversifies Meta’s vendor base and locks in pricing that could mitigate inflationary headwinds on materials.

To diversify revenue beyond advertising, Meta confirmed trials of premium subscription plans on Instagram, Facebook and WhatsApp. Early tests will offer AI-enhanced features—such as image-generation tools and advanced content moderation controls—for fees starting at $4.99 per month. The company has indicated that paid tiers could contribute up to $5 billion in incremental revenue by 2027 if adoption reaches just 2% of its combined user base of 3.8 billion. Feedback gathered during this pilot phase will inform a broader rollout planned for mid-2026, with breakeven on incremental development costs projected within 18 months of launch.