LlamaCon Preview: Stock Volatility Likely
Meta Platforms will hold its LlamaCon event today, where it is expected to showcase its latest AI tools and developments. Below is my preview of the event.
-
Llama 4 Developments:
Comments regarding the Llama 4 models will take center stage. Following concerns about the underperformance of initial Llama 4 versions, the market will look for reassurance, possibly through performance metrics related to the yet-to-be-launched Llama 4 Behemoth model. Updates on Meta’s progress with AI agents will also be closely monitored. -
CapEx Guidance:
Analysts largely expect Meta to reiterate its CapEx guidance of $60–65 billion for 2025, as generative AI is seen as a long-term strategic priority. If Meta signals a reduction in CapEx investment — perhaps citing tariff headwinds — the market may react negatively, especially since other players such as Alphabet have reaffirmed their CapEx commitments. -
Meta AI User Base and New Products:
The market will seek updates on the Meta AI user base. The most recent insights from the company indicated that Meta AI has 600 million monthly active users and has received 1 billion downloads. If user growth appears underwhelming, sentiment could turn negative.
Additionally, reports suggest that Meta may introduce a standalone Meta AI app. A confirmation of these reports could be positive for the stock, as some analysts believe Meta’s feed algorithms on Facebook and Instagram are cannibalizing Meta AI usage. -
Partnerships and Cost Sharing:
Recent reports indicated that Meta had approached Amazon and Microsoft to help share the cost of training the Llama models, but both reportedly declined.
Insights into current collaboration efforts could emerge during the scheduled interview between Mark Zuckerberg and Microsoft CEO Satya Nadella today at 4:00 PM PDT.
Overall, I think the stakes are high going into the event, given the tariff uncertainty and the underperformance of the Llama 4 models. As such, I expect elevated stock volatility as the event unfolds.