Meta’s Big Quarter, Bigger Plans

Hey Superheroes,

Markets recovered somewhat this week with the ASX hitting a seven week high on Tuesday as investors and businesses alike digest the positive developments in the US-Ukraine relationship and President Trump’s announced reprieve on some tariffs for the auto manufacturing industry. 

Next week, the US Federal Reserve meets to discuss interest rates, we’ll know whether Anthony Albanese remains Prime Minister of Australia. Additionally, a raft of companies report earnings, including Palantir and Ford on Monday, AMD and Ferrari on Tuesday, followed by Uber and Novo Novordisk on Wednesday.

For now, let’s dive into this week’s biggest story.

Meta Posts Strong Q1 Results and Confident Q2 Outlook

Meta (NASDAQ: META) crushed its Q1 earnings on Wednesday, beating expectations and sending its share price up 5% in after-hours trading. 

Despite looming tariff pressures and its impact on ad spend on the platform, the company delivered a confident outlook for Q2.

📊 The Numbers

Here’s how Meta performed compared to analyst expectations:

• Revenue: US$42.31 billion vs. US$41.40 billion expected (↑2.2%)
• Earnings Per Share: US$6.43 vs. US$5.28 expected  (↑21.8%)

The revenue has also beat Meta’s own quarterly revenue goals of US$41.8 billion.

Meta’s Q1 net income soared 35% year-on-year(YoY) to US$16.64 billion, up from US$12.37 billion. Sales weren’t far behind, climbing 16% YoY to cap off a strong start to 2025.

Just like Meta CEO Mark Zuckerberg said, “We’ve had a strong start to an important year.” 

🤖 Meta’s Betting Big on AI

Zuckerberg emphasised that Meta is making good progress with its AI push, citing nearly 1 billion monthly users.

Meta also lifted its full-year spending forecast, now expecting to invest US$64–72 billion in capital expenditure, up from the US$65 billion originally projected for 2025. Much of that is earmarked for AI infrastructure.

⛵ Good Earnings ≠ Smooth Sailing

Meta’s forecasting Q2 revenue between US$42.5 billion and US$45.5 billion, with Wall Street’s estimate coming in at US$44 billion.

While the company’s Q2 guidance suggests confidence in the short term, analysts warn a longer-term slowdown may be brewing. Big Meta retailer advertisers like Temu and Shein are pulling back as tariffs bite.

Still, during uncertain times, advertisers tend to stick with the biggest and most reliable platforms like Instagram and Facebook… and Meta knows it. Zuckerberg thinks the company is well positioned to navigate the “macroeconomic uncertainty”. 

🔦 Some other things we’re shining the Spotlight on:

TOYOTA + WAYMO = SELF-DRIVING DUO: Waymo and Toyota are teaming up to bring self-driving tech to personally owned vehicles. This marks Waymo’s first move beyond robotaxis, aiming to license its autonomous software for consumer cars.

PONY AI GALLOPS AHEAD: Chinese driverless tech firm Pony AI Inc (NASDAQ: PONY) saw its stock surge over 22% this week. The boost came after the company unveiled a major partnership with Tencent. The deal will see Pony AI’s autonomous robotaxi services integrated into Tencent’s Weixin Mobility Services and Tencent Maps – a big step toward mainstream adoption.

WOOLIES SWIPES BACK: Woolworths lifted supermarket quarterly sales 3.2% to A$17.3 billion, beating expectations with help from price cuts, Minecraft collectibles and a 16.3% surge in online orders. Meanwhile, Coles is creeping up in customer loyalty.

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