Meta Q1 beats across the board; raises CapEx outlook, and flags DMA risk for Q3
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Meta Q1 2025 revenue rose 16% y/y to $42.31 billion, above management’s upper guidance of $41.8 billion and analysts estimate of $41.37 billion, EPS came in at $6.43 versus analysts estimate of $5.23 while operating margin of 41% exceeded analysts estimate of 38%.
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Family daily active people (DAP) rose 6% y/y to 3.43 billion, above analysts estimate of 3.38 billion, ad impressions grew 5% y/y (analysts estimate: 7%), while average price per ad increased 10% y/y (analysts estimate: +7%).
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Meta’s capital expenditures during the quarter was $13.69 billion, below analysts estimate of $14.32 billion.
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Meta is guiding Q2 2025 revenue in the range of $42.5-45.5 billion billion (analysts estimate: $44.05 billion)-which assumes FX tailwind of 1%, 2025 total expenses in the range of $113-118 billion (lowered from $114-119 billion) and CapEx in the range of $64-72 billion (increased from $60-65 billion).
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Meta flagged the rising risk from EU’s DMA, pointing out that it could significantly impact its business as early as Q3.
“Based on feedback from the EC in connection with the DMA, we expect we will need to make some modifications to our model, which could result in a materially worse user experience for European users and a significant impact to our European business and revenue as early as the third quarter of 2025. We will appeal the EC’s DMA decision but any modifications to our model may be imposed before or during the appeal process,” Meta said in the press release.