Beta Finch - Meta Platforms - META - EN

**BETA FINCH PODCAST SCRIPT: Meta Q1 2026 Earnings**---**ALEX:** Welcome to Beta Finch, your AI-powered earnings breakdown! I'm Alex, and I'm joined as always by my co-host Jordan. Today we're diving into Meta's Q1 2026 earnings call, and wow - there's a lot to unpack here.Before we jump in, I need to mention that this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.Jordan, Meta just reported some pretty impressive numbers - $56.3 billion in total revenue, up 33% year-over-year. That's a monster quarter!**JORDAN:** Absolutely, Alex. And that earnings per share of $10.44 really caught my attention, though there's a big asterisk there - they had an $8 billion tax benefit that boosted things significantly. Without that, we're looking at $7.31 per share, which is still solid but gives us a clearer picture of the underlying performance.**ALEX:** Right, and speaking of underlying performance, the engagement metrics are where things get really interesting. Mark Zuckerberg spent a lot of time talking about their new AI model called "Muse Spark" from their Meta Superintelligence Labs. This seems like their big bet on competing with OpenAI and Google in the AI race.**JORDAN:** That's the story of this earnings call, Alex. Meta is going all-in on AI, and I mean ALL-IN. They're increasing their capital expenditure guidance to $125-145 billion for 2026 - that's up from their previous range of $120-135 billion. We're talking about massive infrastructure investments here.**ALEX:** And the results seem to be paying off already. They're seeing double-digit increases in Meta AI sessions per user since launching Muse Spark. But what really stood out to me was how they're using AI to improve their core recommendation systems. On Instagram, they drove a 10% lift in Reels time spent, and on Facebook, total video time increased more than 8% globally - that's the largest quarter-over-quarter gain in four years!**JORDAN:** Those engagement improvements are crucial because that's what drives ad revenue, which was $55 billion this quarter, up 33%. But here's what's fascinating - they're not just throwing more ads at people. They're using AI to make ads more effective. They mentioned a 6% increase in conversion rates for landing page view ads and over 8 million advertisers now using their AI-powered creative tools.**ALEX:** The business AI piece is really taking off too. Susan Li mentioned they now have over 10 million weekly conversations between people and business AIs on their messaging platforms - that's up from just 1 million at the start of the year. That's 10x growth in just one quarter!**JORDAN:** And let's talk about the elephant in the room - that massive increase in contractual commitments. They added $107 billion in contractual commitments this quarter for infrastructure and cloud deals. That's not just spending money; that's locking in capacity for the next several years.**ALEX:** Which brings us to the cost management side. Meta announced they're planning workforce reductions in May. They're calling it a move toward a "leaner operating model" to help offset these substantial AI investments. It's interesting - they're betting that AI will make their remaining employees more productive.**JORDAN:** The Ray-Ban smart glasses story continues to be a bright spot too. Daily users tripled year-over-year, and they're expanding beyond just Ray-Ban to other brands. Mark mentioned this is "one of the fastest growing categories of consumer electronics ever." That's a bold claim, but the numbers seem to back it up.**ALEX:** In the Q&A, there were some really revealing moments. When asked about return on investment for all this AI spending, Zuckerberg essentially said they're following their traditional playbook: build experiencesThis episode includes AI-generated content.