Meta Raises 2026 Capex to $145 B, Signals Slower Q2 Growth

Context\ Meta Platforms’ shares have slipped roughly 10% since the company released its first‑quarter 2026 update. Investors are reacting to two headline numbers: a higher capex range and a more modest revenue outlook for the second quarter.

Key Facts\ - The company now expects to spend between $125 billion and $145 billion on capital projects in 2026, up from the prior $115‑$135 billion range.\ - CEO Mark Zuckerberg attributes the increase mainly to rising component costs, with memory pricing driving most of the lift.\ - Q1 revenue rose 33% year over year to $56.3 billion, a 29% increase after stripping out a 2% foreign‑currency boost.\ - For Q2, Meta guided revenue of $58‑$61 billion. Removing the assumed 2% currency tailwind leaves constant‑currency growth at roughly 23%, down from Q1’s 29%.

What It Means\ The expanded capex budget reflects Meta’s push to fund data‑center expansion, AI infrastructure, and the rollout of new hardware. Higher memory prices, a key input for servers and AI chips, are inflating costs across the tech sector, forcing Meta to allocate more cash to maintain its growth trajectory.

At the same time, the Q2 revenue guide signals a deceleration in the core advertising engine. Ad impressions grew 19% year over year in Q1, while average price per ad rose 12%, but the company now anticipates a slower pace of ad demand. CFO Susan Li noted that the guidance embeds macro uncertainty and leaves room for variability in advertiser spending.

Investors are weighing the larger spend against the softer growth outlook. A higher capex ceiling raises the breakeven point for each dollar of revenue, making the six‑percentage‑point dip in growth more consequential for long‑term returns. However, Meta’s forward price‑to‑earnings multiple sits near 20, suggesting the market may have already priced in much of the disappointment.

Looking Ahead\ The next earnings call will reveal whether Q2 revenue hits the midpoint of the $58‑$61 billion range and how quickly component costs stabilize. Those data points will determine if Meta’s expanded investment plan can sustain its growth momentum.