-- Meta Platforms (META) shares fell early Thursday as the Facebook parent raised its full-year capital expenditure guidance mainly due to higher component pricing, even though it reported stronger-than-expected first-quarter results.
The technology giant now anticipates capital expenditures to be in a range of $125 billion to $145 billion for 2026, up from its previous projections of $115 billion to $135 billion, Chief Financial Officer Susan Li said in a late Wednesday statement.
"We are increasing our infrastructure (capital expenditure) forecast for this year," Chief Executive Mark Zuckerberg said during an earnings call, according to a FactSet transcript. "Most of that is due to higher component costs, particularly memory pricing."
Capital expenditures stood at $19.84 billion for the March quarter. Shares of the company, which also owns WhatsApp and Instagram, fell nearly 9% in the most recent premarket activity.
"The trend over the last few years seems clear that we are seeing an increasing return on the amount that we can improve engagement for people and value for advertisers," Zuckerberg said. "This encourages us to continue investing heavily in what we expect will provide increasing value over the coming years as well."
Microsoft (MSFT) said Wednesday that it expects capital expenditures of $190 billion for the 2026 calendar year, including roughly $25 billion from higher component pricing.
Meta continues to see regulatory scrutiny over youth-related issues and has additional trials scheduled in the US this year, which may result in a "material loss," Li said. On Wednesday, the European Commission said it preliminarily found Meta to be in breach of the Digital Services Act for failing to prevent minors under 13 from accessing Instagram and Facebook.
For the first quarter, the company's net income surged to $10.44 a share from $6.43 the year before, topping FactSet-polled consensus of $6.67. Revenue climbed 33% to $56.31 billion, ahead of the Street's view for $55.56 billion.
Advertising revenue jumped to $55.02 billion from $41.39 billion in the 2025 quarter. Average price per ad inclined 12%, amid broad-based growth as the group benefited from ad performance improvements, better macro conditions versus the prior-year period and currency tailwinds in international regions, Li said on the call.
Daily active users for the company's family of apps, including Facebook, Instagram and WhatsApp, increased 4% on a yearly basis to 3.56 billion on average for March, but were down on a quarterly basis due to internet disruptions in Iran, as well as a restriction on access to WhatsApp in Russia. Revenue for Reality Labs, Meta's virtual reality research unit, declined to $402 million from $412 million last year.
For the current three-month period, the tech giant expects revenue to come in between $58 billion and $61 billion, including a 2% foreign-exchange tailwind. The Street is looking for $59.62 billion.
Google parent company Alphabet (GOOG, GOOGL) also disclosed first-quarter results above Wall Street's estimates late Wednesday, while e-commerce giant Amazon (AMZN) issued an upbeat second-quarter revenue outlook.