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Listen to this article in summarized format The company has been stepping up its AI push as CEO Mark Zuckerberg looks to build new sources of revenue beyond advertising and compete with OpenAI and Anthropic. Reuters reported that Meta’s latest AI launches, including Muse, have helped strengthen investor confidence in its strategy, even as the company commits hundreds of billions of dollars to expanding AI infrastructure. Heavy AI spending puts cash flow in focus Meta’s capital expenditure is expected to have more than doubled to $41.68 billion in the September quarter, according to Visible Alpha data cited by Reuters. The sharp increase in investment has already weighed on free cash flow, with analysts expecting a cash burn of $8.52 billion in the third quarter. Still, investors are looking for signs that the spending can translate into stronger growth over time. BofA Global Research analysts said, "Recent AI launches have strengthened confidence in the company's AI execution," while also pointing to healthy advertising demand during the quarter. Morgan Stanley analysts have raised their earnings estimates for 2027 and 2028 despite the higher spending, citing stronger advertising growth and the possibility that new AI products could generate additional revenue. Muse adoption becomes a key test Meta’s Muse assistant, which offers subscriptions, has received a positive response, adding to expectations that AI could eventually become a meaningful business beyond its core advertising operations. Wall Street expects Meta’s revenue to rise 23.8% to $63.42 billion in the quarter, although growth is projected to slow from around 28% in the previous quarter amid competition from Google and TikTok. Net income is expected to fall about 17% to $15.44 billion, according to LSEG data cited by Reuters. Meta shares have gained about 7% this year, trailing the S&P 500’s roughly 12% rise. The results will therefore offer investors a closer look at whether the company’s escalating AI investment is beginning to support growth strongly enough to justify the rising costs. (Disclaimer: This article is based on inputs from agencies. These do not represent the views of The Economic Times) (What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .) Subscribe to ET Prime and read the Economic Times ePaper Online.and Sensex Today. Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price (What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .) Subscribe to ET Prime and read the Economic Times ePaper Online.and Sensex Today. Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price
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