Meta looks to report fastest revenue growth since 2021

Meta will report first-quarter earnings after the bell on Wednesday.

Here's what analysts polled by LSEG are expecting:

• Earnings per share: $6.79 estimated
• Revenue: $55.45 billion estimated

Meta CEO Mark Zuckerberg has spent the past three months continuing his company's deeper push into artificial intelligence following a strategy shift and talent overhaul that he initiated in June with the $14.3 billion investment in Scale AI and the hiring of CEO Alexandr Wang.

Zuckerberg brought in Wang to lead his company's revamped AI unit, Meta Superintelligence Labs, and oversee the building of new models that could make Meta more competitive with OpenAI, Anthropic and Google.

Earlier this month, Meta debuted Muse Spark as its first proprietary foundation model. Investors will now be looking for Zuckerberg to start laying out a clearer strategy towards monetization.

While Wall Street waits, it's getting plenty of growth out of Meta's core advertising business. Analysts expect total revenue, which almost all comes from advertising, to jump 31% from $42.3 billion a year earlier. That would mark the strongest quarter for growth since 2021.

Meta's ad strength shows that the company is benefiting from its advancements in AI even if's yet to find new revenue streams.

Underpinning Meta's AI efforts is a boatload of spending tied to the company's massive data center buildout plans. Meta's capital expenditures for the first quarter are expected to come in at $27.63 billion, according to StreetAccount.

In its fourth-quarter earnings report in January, Meta projected capex for the year will be between $115 billion and $135 billion. Meta's hyperscaler peers — Alphabet, Amazon and Microsoft — are also reporting after the bell on Wednesday, and will be updating investors on their spending plans for the first time since the U.S-Iran war began in February, leading to a spike in oil prices.

As it ramps up spending, Meta has also been slashing headcount. The company said last week that it's laying off about 10% of its workforce, or 8,000 employees, while no longer hiring people for 6,000 open roles. Those cuts follow January's layoffs affecting about 1,000 people in the company's Reality Labs unit, and another round in March targeting hundreds of staffers in areas like Facebook, global operations and sales.

Analysts estimate that Reality Labs, the virtual and augmented reality division, will post a first-quarter operating loss of $4.82 billion on $488.8 million in revenue.