Meta Reports Q1 Earnings Tomorrow: 3 Things to Watch on AI Spend

Meta (META.OQ) reports Q1 2026 earnings after the close on April 29 with management guiding revenue to $53.5B–$56.5B. The company is ramping 2026 capital expenditures to $115B–$135B (vs. $69.69B in 2025) to fund AI infrastructure and talent, including multi-year deals with Amazon AWS and Corning and a 20‑year power pact with Vistra. The market is watching whether near‑30% ad revenue growth and stable operating income can justify the massive capex; operating margin compressed 700 bps to 41% YoY, Reality Labs losses remain ~$19.2B, and free cash flow declined 19% to $43.59B in 2025. Analysts are largely constructive (61 buys, avg PT $855), and Polymarket shows a high probability of an EPS beat, but upside depends on ad acceleration and margin resilience. Q1 results will be the first test of whether Meta’s AI buildout is financially sustainable.