Meta Platforms Inc. (NASDAQ:META) shares slid nearly 9% on Thursday as investors digested the firm’s mixed second-quarter results.
Revenue of $60.8 billion beat estimates, but a $2.4 billion legal charge and $1.18 billion in severance costs dragged earnings per share to $6.18, well below Street expectations near $7.19.
Analysts responded with a wave of price-target cuts, even as most held their ratings steady.
- META stock feels the heat. See the chart and price action here.
Experts Weigh In
Needham
Needham analysts Laura Martin and Dan Medina delivered the sharpest line of the day as they kept their Hold rating under the headline “META: A Strategy Only a CEO Can Love. Unanswered Questions Abound.”
Martin argued Meta is “fighting battles on too many fronts,” spreading capital across custom chips, data centers, enterprise software, agents, model APIs and smart glasses at once. She flagged stock-based compensation of $356,840 per employee as twice Alphabet’s rate.
That, she said, is “owing to low morale at META and a low ‘corporate values’ rating.” Free cash flow came in near zero at $784 million, and Martin expects it to turn negative next quarter. Her closing question: “Does META have a terminal value?”
Rosenblatt
Rosenblatt’s Barton Crockett stayed at Buy but slashed his price target to $883 from $1,015. He wrote that “skepticism is rampant” even though “core ads and costs were fine.”
Crockett traced part of the selloff to a “head-fake on cloud deals,” after a July 17 New York Times report of a $10 billion Anthropic compute deal that never materialized. He cut his target multiple to 15x EV/EBITDA from 17x, a discount to the multiple he assigns Alphabet Inc. (NASDAQ:GOOGL) (NASDAQ:GOOG).
Guggenheim
Guggenheim’s Michael Morris maintained his Buy rating while cutting his target to $700 from $800 under the headline “Proof Soon, But Not Yet.” Morris noted operating margin compressed 620 basis points on AI talent costs. Management’s lone concrete monetization proof point, he said, was Meta Business Agent, which “begins paid monetization on August 1” in what executives called “very early stages.”
Bank of America Securities
Bank of America analyst Justin Post reiterated a Buy rating and lowered his price objective to $810 from $835.
He argued the Street is “likely underappreciating Meta’s ability to monetize its growing capacity assets.” Post pegged the stock at just 13x his 2027 estimate for the core Family of Apps business.
He also pointed to Meta’s next-generation model, code-named Watermelon, which “has achieved frontier-level performance on internal benchmarks” ahead of a possible unveiling at September’s Connect Conference.
Cantor Fitzgerald
Cantor Fitzgerald’s Deepak Mathivanan kept his Overweight and Top Pick rating but trimmed his target to $680 from $770, noting “significant capex spend demands a little more.”
He highlighted the new Meta Generative Recommender, which drove an 8.3% lift in ad clicks and a 15.7% jump in conversions on Facebook. Advantage+ also hit a $75 billion annual run rate.
D.A. Davidson
D.A. Davidson’s Gil Luria held his Buy rating and cut his target sharply to $700 from $850 under the headline “METAmorphosis.” He pointed to a capital expenditure guide now implying $137.5 billion at the midpoint, plus early traction for the Muse Spark 1.1 coding agent.
JPMorgan
The most cautious call came from JPMorgan’s Doug Anmuth, who stayed Neutral and lowered his price target to $640 from $725.
Meta “did not come away learning much incremental on the developer API, consumer/business agents, or potential plans to directly monetize compute,” Anmuth wrote. He now projects 2027 capital expenditures of $243 billion, up 70% year over year.
KeyBanc
KeyBanc’s Justin Patterson held his Overweight rating and trimmed his target to $780 from $790. He framed Meta’s enterprise push as a potential “business in a box” that could let a company run entirely on Meta’s platforms. A new product cycle, Patterson argued, “may start to answer ROIC questions.”
The Bottom Line
Across the eight notes, six analysts kept Buy-equivalent ratings, one held Neutral and Needham stayed at Hold. Targets ranged from $640 at J.P. Morgan to $883 at Rosenblatt.
Every adjusted price target moved lower, underscoring shared unease over capital spending even as advertising demand held firm.
META Stock Price Activity: Meta Platforms shares were down 8.95% at $533.17 at the time of publication Thursday, according to data from Benzinga Pro.
Over the past month, META has declined about 5.0% versus a 0.7% decline in the S&P 500 and is down roughly 20% year-to-date compared to the index’s 7.4% gain.
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