'Fast Money' traders talk how to play Meta following Q3 results

Capital Expenditure (Capex) & Investment - Meta raised its 2025 capital expenditures range to $70-72 billion, up from a prior range of $66-72 billion, to invest in AI strength [1] - Meta expects capital expenditure dollar growth to be notably larger next year (2026) [1] - Meta has recent cloud deals including a $10 billion deal with Google, a $14 billion deal with CoreWeave, and a $20 billion deal with Oracle [2] - Tech sector is shifting from "capex light" to "capex heavy," similar to energy exploration companies [4] - Companies are investing ever larger amounts of capex to keep up with AI growth, potentially diminishing the value proposition and return on investment [5] Financial Implications & Market Concerns - Increased capex spending is raising concerns about ROI [3][5][6] - Meta's data center build-out is starting to hit the debt markets [10] - Blue Owl is lending $27 billion for Meta's data center in Louisiana, with a 20% stake [11] - Some debt is being issued at 1% above, potentially becoming junk and finding its way into ETFs [12] - Companies have been funding buildout through cash flow, but this may not be sustainable as it reaches 30% of revenue [13] Meta's Performance & Strategy - Meta AI is currently behind other chatbots, and the company is investing to improve it [8] - Meta's ad targeting has been good, but there's a potential wall and increased competition from companies like OpenAI [9][10] - Meta took a $16 billion charge, and without it, EPS would have been 10% better than expected [16] - Margins are now north of 40% [16]