TD Cowen reaffirmed its “Buy” rating and USD 820 price target on Meta Platforms after the company reported quarterly results that topped analysts’ expectations. The target price implies further upside from Meta’s current share price of USD 738.

Meta’s fourth-quarter revenue and operating income beat consensus estimates by 2% and 3% respectively, driven primarily by a robust 18% year-on-year increase in ad impressions. The company maintained an impressive gross margin of 82.01%.

The social media giant also issued first-quarter revenue guidance that was roughly 10% above market expectations. Management attributed this outperformance to AI-driven improvements in user engagement and monetisation, as well as around 4 percentage points of tailwind from foreign exchange.

Meta further announced 2026 capital expenditure guidance in the range of USD 115–135 billion, broadly in line with TD Cowen’s pre-report estimate of USD 125 billion. However, the midpoint of its operating expense guidance came in 6% above the firm’s forecast.

J.P. Morgan also raised its price target on Meta to USD 825, citing the strong first-quarter revenue outlook and expecting growth to remain in the 30% range. Artificial intelligence is seen as the key driver of higher user engagement. William Blair echoed this positive stance by reiterating its “Outperform” rating, highlighting Meta’s steadily improving engagement metrics and its AI strategy.

Meta’s family of apps now boasts more than 3.5 billion daily active users, with both ad impressions and Instagram Reels watch time recording significant growth.

Market Commentary：

Meta has several AI-driven growth engines. These include higher user engagement driven by AI-generated content, as well as commercial AI tools designed for businesses. In addition, Meta AI and AI-powered devices form key parts of its future strategy. The models that power these products are expected to be launched over the coming months, potentially unlocking further upside for growth and monetisation.