Meta stock climbs on Q4 earnings beat, plans to spend as much as $135 billion on AI build-out in 2026

Financial Performance - Meta reported Q4 earnings per share (EPS) of $8.88 on revenue of $59.9 billion, surpassing analysts' expectations of $8.16 EPS and $58.4 billion in revenue [2] - The stock price increased by as much as 10% following the earnings announcement, maintaining momentum into the next trading session [1] Capital Expenditures - The company anticipates capital expenditures between $115 billion and $135 billion in 2026, a significant increase from the $72.22 billion spent in 2025 [1] AI Investments and Challenges - Meta's Reality Labs division generated $955 million in revenue but incurred losses of $6 billion, exceeding the expected operating loss of $5.9 billion [3] - The company has invested $14.3 billion to acquire 49% of Scale AI and appointed its CEO as Meta's chief AI officer [4] - Meta is considering making its next major AI model proprietary, moving away from an open-weights strategy [5] Competitive Landscape - Meta is facing increased competition in the AI sector, with Google’s Gemini 3 model currently leading the market [7] - The company is also dealing with regulatory challenges, including an appeal by the Federal Trade Commission (FTC) regarding its acquisitions of Instagram and WhatsApp [8]