JPMorgan Downgrades Meta to Neutral as AI CapEx Risks Eclipse Q1 Strength

JPMorgan downgraded Meta Platforms Inc to Neutral from Overweight, slashing its price target to $725 from $825, despite blowout Q1 results with $56.31B revenue (+33% YoY) and $10.44 EPS beating estimates. The move highlights concerns over escalating AI infrastructure spending, with Meta raising full-year CapEx guidance to $125B–$145B from $115B–$135B and Q1 CapEx at $19B (+47% YoY). JPMorgan forecasts 2027 CapEx at $202B, negative free cash flow of $4B in 2026 and $24B in 2027, valuing shares at 21x 2027 EPS of $34.01, pressuring the stock amid debates on AI monetization returns.