In a recent financial update, Meta Platforms Inc. (META) announced its fourth-quarter results that surpassed market expectations. However, the company also projected a slowdown in revenue growth for the current quarter and indicated that expenses would increase more rapidly in 2025 compared to the previous year. Initially, shares dipped by 4% in after-hours trading but recovered slightly to a 1% gain by early evening. The social media giant reported earnings per share of $8.02 on revenues of $48.4 billion, exceeding analysts' predictions. For the full year, net income reached $62.4 billion, marking a significant 59% increase from the prior year. While the company forecasted first-quarter revenue between $39.5 billion and $41.8 billion, it chose not to provide a full-year outlook, emphasizing ongoing investments in its core business.
Meta's financial performance has been robust, with the fourth quarter showing a 21% rise in revenue compared to the same period last year. CEO Mark Zuckerberg recently outlined plans to invest heavily in artificial intelligence infrastructure, allocating between $60 billion and $65 billion for projects this year. This investment includes the development of a massive data center, which underscores the company's commitment to advancing AI technology. CFO Susan Li highlighted that expenses for 2025 are expected to range from $114 billion to $119 billion, significantly higher than the $95.1 billion projected for 2024. Infrastructure costs and employee compensation were identified as key drivers of this expense growth.
The company's strategic focus on AI and other priority areas is evident in its financial planning. Zuckerberg expressed optimism about scaling these initiatives further in 2025, particularly in infrastructure, monetization, Reality Labs, and generative AI. Additionally, Meta continues to make strides in developing glasses and enhancing the future of social media platforms. The company's dedication to innovation is reflected in its willingness to allocate substantial resources toward these endeavors.
Despite the positive earnings report, Meta faced challenges related to regulatory issues. Shortly before the earnings release, it was revealed that the company had settled a lawsuit with former President Trump for $25 million. The suit pertained to Meta's decision to suspend Trump from its platforms following the January 6 insurrection in 2021. This settlement underscores the ongoing complexities Meta navigates in balancing user policies with broader societal concerns.
The company's strong financial performance in the fourth quarter sets a solid foundation for future growth. With continued investments in cutting-edge technologies and strategic areas, Meta aims to maintain its leadership in the digital landscape. The projected increase in expenses reflects the company's commitment to long-term success and innovation, positioning it well for the challenges and opportunities ahead.