Meta Platforms Inc. (NASDAQ:META) walks into its third-quarter earnings report Wednesday with investors doing a delicate balancing act. On one side: AI-driven advertising momentum and early buzz around Muse, the company's AI agent. On the other: a mountain of infrastructure spending, enterprise restrictions on Muse's access, and the nagging question of when the new AI agent actually starts paying for itself.
The stock gained more than 2% Wednesday after falling almost 4% over the previous five sessions, as investors repositioned ahead of the Oct. 21 report.
Wall Street expects third-quarter earnings of $5.74 per share, down from $7.25 a year earlier, while revenue is projected to rise to $63.37 billion from $51.24 billion.
BNP Paribas: Muse Gains Traction, But Doors Are Closing
BNP Paribas analyst Nick Jones kept a positive view with an $885 price forecast. Jones said Muse continues to gain downloads while maintaining solid retention, and he sees long-term opportunities in transaction fees, data insights, increased engagement across Meta's Family of Apps, and advertising.
But he flagged a growing problem: companies in e-commerce, banking, insurance, travel, and media are limiting Muse's access over security concerns. Those restrictions, in Jones's view, show Meta still needs to refine Muse's product-market fit and work with content and commerce partners rather than disintermediate them.
Rosenblatt: The Ad Engine Is Still Humming
Rosenblatt Securities analyst Barton Crockett maintained a Buy rating and an $886 price forecast. He expects third-quarter revenue growth near the upper end of Meta's 19%-25% guidance range, supported by AI-driven improvements in engagement and ad effectiveness. Rosenblatt projects revenue of $63.94 billion and adjusted EPS of $6.95.
Then there's the spending. Crockett expects Meta to spend $130 billion-$145 billion on capital expenditures in 2026 and said a move toward roughly $200 billion in 2027 would be reasonable. His argument: core advertising improvements can justify those investments even before Muse becomes a meaningful revenue contributor.
Citizens JMP: A $10 Billion Muse Opportunity, Eventually
Citizens JMP Securities analyst Andrew Boone maintained a Market Outperform rating and an $885 price forecast. Boone expects consumer AI agents to surpass 100 million daily active users by the end of 2027 and estimates Muse could generate more than $10 billion in annual advertising revenue at that scale. That potential is not included in his current forecasts.
He sees advertising as the stronger monetization model for AI agents as they increasingly help users discover products, complete tasks, and make purchases.
Together, the analysts remain bullish on Meta's AI opportunity, but the near-term debate centers on capital intensity, enterprise adoption, and how quickly Muse can translate usage into sustainable revenue.
META Price Action: Meta Platforms shares were up 2.09% at $708.78 at the time of publication on Wednesday, according to market data.
