Deepwater's Gene Munster on his takeaways from Meta's investor call

Core Insights - Meta's stock decline is attributed to a shift in the dynamic between revenue growth and expense growth, with expenses outpacing revenue growth for the first time in two years [2][3][4] - Microsoft and Alphabet also reported earnings, with Microsoft experiencing a similar downtick in earnings growth, indicating a broader trend among big tech companies [1][6] Meta Analysis - Meta's revenue growth for 2024 is projected at 23%, while expenses are expected to grow by 32%, marking a significant shift from previous years where revenue growth consistently outpaced expenses [2][3] - The company reported a revenue growth of 22% in the first two quarters of the year, but expenses grew by 12%, highlighting a concerning trend for investors [2][3] - Engagement metrics remain strong, with 43% of the global population using Meta's products daily, indicating potential for future growth despite current challenges [4] Microsoft and Alphabet Insights - Microsoft is facing a similar situation, with a notable shift in expense growth that has surprised investors [6][9] - The market is currently expecting a 40% growth for Microsoft in 2026, but there are indications that it could exceed 60% [8] - Alphabet's capex is projected to increase by 25%, reflecting a broader trend of increased investment in technology infrastructure across major tech companies [8] Future Expectations - The market is looking for signs of improvement in revenue growth rates and expense management in the upcoming December quarter [12][13] - Meta needs to demonstrate a revenue growth rate closer to 20% to regain investor confidence, as the current expectation is at 16% [13]