Meta is set to report its Q1 earnings amidst scrutiny over the effects of President Trump's tariffs on U.S. businesses. As analysts project earnings per share of $5.25 and revenue of $41.3 billion, concerns arise over the advertising sector, influenced by China's reduced ad spending and the impending impact of changes to de minimis exemptions. Jefferies analyst Brent Thill highlights Meta's vulnerability due to its heavy reliance on advertising. The company's ongoing legal battles with the FTC further complicate its market standing as it addresses both operational challenges and regulatory scrutiny.
"We attribute weakness to [Meta's] greater exposure to advertising (no cloud business for [Meta]) and China-based advertisers (>10% exposure for [Meta]) who have reportedly pulled back on ad spend."
"In his own note, BofA Securities analyst Justin Post said he expects to see a modest beat on Q1 revenue but believes the company will offer a more conservative guide for the second quarter."
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