Meta Posted Its Best Sales Growth Since 2021—So Why Did Shares Fall?

Meta reported strong Q1 2026 results—revenue of $56.31 billion (up 33% YoY) and adjusted EPS of $10.44—yet shares fell sharply after the company raised full-year capital expenditure guidance to $125–$145 billion. Investors focused on the higher CapEx (midpoint up ~8% to $135B) and unclear near-term monetization for its new Muse Spark AI model, prompting an after-hours selloff despite beats on top and bottom lines and robust ad metrics. Management kept full-year expense guidance unchanged and gave Q2 revenue guidance roughly in line with expectations ($58B–$61B). Market reaction underscores investor sensitivity to elevated AI-related spending and execution risk, even when growth and margins look strong.