Meta posts strong Q1 2025 results, driven by advertising and AI

Meta Platforms, Inc. has announced its financial results for the first quarter of 2025, showcasing significant growth in revenue and net income. Meta founder and CEO Mark Zuckerberg expressed optimism about the company's performance, highlighting advancements in artificial intelligence (AI) technologies and a growing user base.

"We've had a strong start to an important year; our community continues to grow, and our business is performing very well," said Zuckerberg. "We're making good progress on AI glasses and Meta AI, which now has almost 1 billion monthly actives," he added.

Meta’s Q1 2025 revenue rose 16% year over year to $42.31 billion, outperforming analyst expectations. Net income soared 35% to $16.64 billion, reflecting efficient scaling and high-margin performance across its core advertising business. Diluted earnings per share came in at $6.43, up 37% from Q1 2024.

The revenue growth was underpinned by a 6% rise in daily active users across Meta’s family of apps—Facebook, Instagram, Messenger, and WhatsApp—reaching 3.43 billion. Ad impressions increased 5%, while the average price per ad rose 10%, signalling both higher user engagement and stronger monetisation.

Meta earned approximately $40.97 billion in advertising revenue in Q1 2025.

Expenses rose 9% to $24.76 billion, trailing revenue growth and showing operational discipline. Capital spending surged to $13.69 billion, fuelled by AI and data centres, while free cash flow dipped to $10.33 billion. Headcount increased 11% to 76,834, with hires focused on AI and compliance.

However, despite the strong quarter, Meta faces rising scrutiny from regulators. The European Commission recently ruled Meta’s ad-free subscription model non-compliant with the Digital Markets Act. The decision could require a redesign of how Meta offers data usage choices in the EU, potentially reducing ad effectiveness and user satisfaction.

Meta also cited “legal and regulatory headwinds” in both the US and EU in its risk disclosures, a signal that the company anticipates heightened intervention that could impact its advertising model and platform operations.

Looking ahead, Meta expects Q2 revenues between $42.5 billion and $45.5 billion. It slightly trimmed its full-year expense outlook to $113–118 billion while raising its capital expenditure range to $64–72 billion, up from $60–65 billion, as it doubles down on AI and data centre investments.