- Meta Platforms is set to report its Q2 earnings on July 31.
- A ramp up of investments towards artificial intelligence technology may impact cash flow and margins.
- We see risks tilted to the downside for the stock.
Anticipation is building for Meta Platform’s (NASDAQ:META) (NEOE:META:CA) second-quarter earnings report, set to be released on July 31 after the market close. Shares of the social media giant have surged over the past year, but are struggling to maintain momentum, down more than 14% from its 52-week high.
While a growth resurgence and improved profitability have been the big story since 2023, the challenge now for Meta is to deliver on a high bar of expectations. We highlighted this theme when we last covered the stock in May with a hold rating, suggesting investors should not count on a new all-time high anytime soon.
Our update today takes a more bearish tone, viewing META’s upcoming Q2 report as a high-risk event that could kickstart a deeper correction in the stock. Here’s what we expect.
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