Meta's Mark Zuckerberg is expected to meaningfully cut resources for building the so-called metaverse, an effort that he once framed as the future of the company and the reason for changing its name from Facebook.Read our exclusive story: https://t.co/b7vZXGNv9y📷️: Hollie Adams/Bloomberg ...

Core Insights - Meta's Mark Zuckerberg is expected to significantly reduce resources allocated for the development of the metaverse [1] Company Actions - The decision to cut resources is based on discussions among company executives [1]

Meta's Zuckerberg is planning cuts as high as 30% for his metaverse efforts, after the idea of living in virtual worlds has failed to take off https://t.co/qV0g8l2QHs ...

Core Insights - Meta is launching a new creative studio within its Reality Labs division, led by former Apple design executive Alan Dye, to innovate future products and services [1][2] Group 1: Leadership and Team Composition - Alan Dye, who has extensive experience at Apple, will head the new studio, which will also include other notable design leads from Apple and Meta's existing design teams [3] - The team aims to leverage their combined expertise in creating products that integrate hardware and software seamlessly [2][3] Group 2: Vision and Objectives - Mark Zuckerberg emphasized that the studio's focus will be on developing AI glasses and other devices that enhance human-technology interaction, aiming for natural and intuitive user experiences [4] - The studio's mission is to ensure that every interaction with their products is thoughtful and centered around user needs [4] Group 3: Alan Dye's Background - Alan Dye joined Apple in 2006 and became the Design Studio Lead in 2015, significantly influencing the design evolution of major Apple platforms [5][6] - His work included the introduction of Liquid Glass, a new material that transformed the aesthetics and usability of Apple's devices [5][6]

Microsoft - Microsoft stock is rated as a "Strong Buy" by 39 out of 48 analysts, with an average target price of $630.59, indicating a potential upside of 32.6% [1] - The company has strengthened its partnership with OpenAI, gaining exclusive Azure privileges and extended access to models and IP [2] - Microsoft ended the quarter with $102 billion in cash and short-term investments, and has a record backlog of $392 billion, positioning it well for growth [2] - The company invested $34.9 billion in AI and cloud expansion, with half allocated to shorter-lived chips and hardware, and the other half for long-term infrastructure [3] - In the fiscal 2026 first quarter, Microsoft reported revenue of $77.7 billion, a 17% increase year-over-year, and earnings of $4.13 per share, up 21% [4] Amazon - Amazon stock is also rated as a "Strong Buy," with 49 out of 57 analysts recommending it, and an average target price of $295.85, suggesting a potential upside of 36% [8] - Amazon Web Services (AWS) reported a 20% year-over-year revenue increase in Q3, with an annualized revenue run rate of $132 billion and a backlog of $200 billion [7] - The company is investing over $90 billion this year to prepare for an AI-driven future, while maintaining healthy profitability with EPS rising 36% to $1.95 [7] Meta Platforms - Meta Platforms stock is rated as a "Strong Buy" by 43 out of 56 analysts, with an average price target of $838.62, indicating a potential upside of 42.3% [11] - The Family of Apps segment generated $50.8 billion in revenue, a 26% increase year-over-year, driven by strong advertising demand [9] - Reality Labs revenue increased by 74% to $470 million, supported by interest in AI-enabled products [10] Alphabet - Alphabet stock is rated as a "Strong Buy" by 43 out of 55 analysts, with an average target price of $317.92, suggesting a potential upside of 6% [14] - The company reported $102.3 billion in revenue for Q3, marking its first-ever $100 billion quarter, with a 16% year-over-year growth [12] - Google Cloud revenue grew by 34% to $15.2 billion, with a backlog of $155 billion, up 82% from last year [13]

Group 1 - The "Magnificent Seven" includes Nvidia, Microsoft, Apple, Alphabet, Amazon, Meta Platforms, and Tesla, representing 35% of the S&P 500 value [1] - Tesla's core business growth is slowing, contrasting with the strong revenue growth of other companies in the group [4][5] - Tesla's electric vehicle deliveries declined in the first half of 2025, with automotive revenue growing only 6% year over year and operating margin dropping to 5.8% [6] Group 2 - Other companies in the "Magnificent Seven" have strong revenue streams, such as Apple's iPhone and services, Amazon Web Services, and Nvidia's compute and networking segment [5] - Tesla's Robotaxi business is beginning to roll out, but its autonomous Cybercab is not yet in production, highlighting a key difference from its peers [7] - Tesla's valuation is considered astronomically high compared to other companies in the group [7]

Core Viewpoint - Meta Platforms has received a bullish outlook from Wall Street despite recent stock volatility, with a consensus indicating strong buy recommendations for the next 12 months [5][6]. Financial Performance - Meta reported strong Q3 2024 earnings, with adjusted EPS of $7.25, exceeding expectations of $6.69, and revenue of $51.24 billion, surpassing the forecast of $49.41 billion. Sales increased by 26% year-over-year, marking the fastest growth since early 2024 [3][4]. - For Q4, Meta anticipates revenue between $56 billion and $59 billion, which is above analyst expectations at the midpoint [4]. Stock Outlook - A consensus from 41 Wall Street analysts shows a 'Strong Buy' rating, with 34 recommending a purchase, six advising to hold, and only one suggesting a sell [5]. - The average 12-month price target is $839.23, indicating a potential upside of 41.23% from the last closing price of $594.25. Projections vary widely, with a high target of $1,117.00 and a low of $655.15 [6]. Analyst Insights - Cantor Fitzgerald's analyst cut the price target to $720 from $830 but maintained an 'Overweight' rating, citing expected cost increases starting in 2026, with operating expenses projected to rise 30% year-over-year to $152 billion [8]. - Wedbush added Meta to its "Best Ideas List," maintaining an Outperform rating with a price target of $920, highlighting strong core ad demand and AI advancements [9]. - Needham maintained a 'Hold' rating without a price target, while Mizuho raised its target to $920 from $812, reflecting increased confidence after strong fiscal Q3 results [10].

Core Viewpoint - The recent earnings reports from major tech companies indicate a shift in the perception of the AI sector, with some companies demonstrating strong monetization strategies while others, like Meta, face scrutiny for their spending without clear revenue generation plans [2][3][4]. Group 1: AI Sector Performance - The earnings round is referred to as the "mythbuster quarter" for AI, suggesting that previous speculation about an AI bubble may be unfounded [2]. - Companies like Alphabet have shown that AI can significantly drive new sales, particularly in cloud services, leading to strong earnings across major tech firms [4]. - Meta is identified as a major loser in this earnings cycle due to a lack of clear monetization strategies for their AI investments, resulting in a decline in their stock price [5][7]. Group 2: Company-Specific Insights - Alphabet and Amazon have successfully integrated AI into their advertising products, resulting in improved revenue metrics, such as an increase in revenue per click for Google and revenue per ad for Meta [8]. - Meta's lack of a public cloud service limits its ability to monetize AI effectively, leading to skepticism about its spending compared to other tech giants [9]. - Apple has maintained a conservative approach to AI, focusing on its existing ecosystem and product offerings, which has proven successful in generating revenue without heavily investing in AI [10][12][13]. Group 3: Future Outlook - Upcoming earnings reports from Nvidia and Broadcom are anticipated to be strong, benefiting from increased spending in the tech sector [15]. - There is interest in understanding Nvidia's backlog and adoption rates, as well as the overall earnings growth trajectory in the tech industry, which has slowed due to the scale of existing revenues [17][18].

Core Insights - Meta Platforms is experiencing a significant decline in profits, leading to some investors abandoning the stock, which may be a costly mistake due to the company's strong position in AI [1][3] - The company reported a 26% year-over-year revenue increase to $51.2 billion, surpassing analysts' expectations of $49.6 billion, driven by an 8% growth in its user base to 3.54 billion [5][6] Financial Performance - Operating expenses rose 32% to $30.7 billion, outpacing revenue growth, which raises concerns among investors [6] - Diluted earnings per share (EPS) fell 83% to $1.05, prompting some investors to sell their shares [6] Contributing Factors - A one-time, non-cash tax charge of $15.93 billion due to new legislation significantly impacted profitability; excluding this charge, earnings would have increased 20% year-over-year to $7.25 [8] - Increased investments in AI, including higher employee compensation and infrastructure costs, are expected to yield long-term benefits despite short-term financial strain [9][10] AI Investments and Future Outlook - Meta's AI investments are already showing positive results, with a 10% increase in time spent on Threads and a 5% increase on Facebook due to improved recommendation systems [10] - The company has narrowed its capital expenditure outlook for the year to $70 billion to $72 billion, indicating a strategic focus on AI [12] Valuation and Investment Opportunity - Meta's stock price decline post-financial report is viewed as a buying opportunity for long-term investors, with the stock trading at 24 times earnings, which is considered attractive compared to peers [13]

So, the Dow was earlier made of muscle. The S&P and Nasdaq, well, they've been atrophying most of the session here. The S&P hasn't even been in the positive today.Right now, it's down at 48 points. The Nasdaq is lower by 30. Low of the session, 329 points of losses.And two magnificent moguls are really more like preh Halloween monsters right now. Meta is getting kneecapped at the moment. Let's look at Meta.is down right now 11 and a half%. Investors do not care that the Facebook parent posted a double beat ...