Sometimes the best relationships are the ones you take a break from and then come back to. That seems to be activist investor Dan Loeb's philosophy with Meta Platforms Inc. (META), anyway. His hedge fund Third Point LLC just increased its stake in the social media giant by 47% during the third quarter of 2025, bringing total holdings to 220,000 shares—up from 150,000 shares in Q2.
Here's where it gets interesting: Third Point didn't just trim its Meta position earlier this year. The firm completely dumped it. According to 13F filings, Third Point held 665,000 shares at the end of Q4 2024, then exited entirely in Q1 2025. Now, two quarters later, they're back in—albeit with a smaller position than before. What changed? Let's dig into what might have convinced Loeb to return.
The Earnings Picture: Good Revenue, Messy Bottom Line
Meta's third-quarter earnings in October painted a complicated picture. The company reported diluted earnings per share of just $1.05—way below the analyst estimate of $6.68. But here's the catch: that figure includes a massive one-time, non-cash income tax charge of $15.93 billion. Strip that out, and the picture looks considerably better.
On the revenue side, Meta crushed it. Quarterly revenue came in at $51.24 billion, beating the Street estimate of $49.38 billion and representing a solid 26.25% increase year-over-year. For the fourth quarter, Meta guided to revenue between $56 billion and $59 billion, right in line with the $57.21 billion analyst consensus.
CEO Mark Zuckerberg used the earnings call to double down on the company's bets in emerging technologies, suggesting that Meta's investments in smart glasses and augmented reality devices could eventually become "an extremely profitable business." That's a big claim, but it fits with the company's broader strategic pivot.
Going All-In on AI Infrastructure
Meta isn't just talking about AI—it's putting serious money where its mouth is. Last month, the company announced plans to invest more than $600 billion in the U.S. by 2028 to expand AI technology, data centers, and workforce capabilities. Zuckerberg framed this massive investment as necessary for achieving what he calls "personal superintelligence" for everyone.
As part of this push, Meta revealed plans to invest over $1 billion in constructing a new data center in Wisconsin specifically designed to support artificial intelligence work. The company is also testing a new generative-AI briefing feature on Facebook, part of what appears to be an urgent effort to challenge ChatGPT's dominance in the AI assistant space.
Internally, Meta is reportedly preparing to evaluate employees based on their ability to drive results using artificial intelligence—a signal that AI isn't just a product strategy but a cultural transformation for the entire organization.
On the legal front, Meta also scored a win recently when a federal judge rejected government accusations that the tech giant maintains an illegal monopoly on personal social networking.
Wall Street Remains Split
Following Meta's earnings announcement, analyst opinions diverged. B of A Securities' Justin Post maintained a Buy rating but trimmed his price target from $900 to $810. In his investor note, Post acknowledged that higher capital expenditures and one-time charges leading to the earnings miss were negatives, but argued that the AI opportunity is worth the wait and could drive higher revenue down the line.
On the more optimistic end, Rosenblatt's Barton Crockett kept his Buy rating and actually raised his price forecast from $1,086 to $1,117. Crockett emphasized that AI is already helping Meta put more relevant content in front of users, which improves engagement times and opens up better monetization opportunities.
Performance Lags Behind Peers
Despite Loeb's renewed confidence, Meta's stock performance this year has been underwhelming. Year-to-date, Meta is up just 9.65%, significantly trailing the iShares Global Comm Services ETF (IXP), which gained about 28.36% over the same period.
The underperformance is even more striking when compared to direct competitors. Alphabet Inc. (GOOGL) has surged approximately 66.25% year-to-date, while Baidu, Inc. (BIDU) has climbed about 40.16%. So while Meta is making aggressive moves in AI and infrastructure, the market hasn't yet rewarded the company with the same enthusiasm it's shown for some peers.
Loeb's decision to re-enter Meta—even at a smaller scale than before—suggests he sees value that the broader market might be missing. Whether that bet pays off will likely depend on how quickly Meta's massive AI investments start translating into tangible revenue growth. For now, at least one billionaire investor is willing to make that wager.
