Gene Munster, Brian BakerJanuary 28, 2026
Meta’s March Revenue Guide Required a Double Take, Underscoring AI Is Already Amping Sales Growth
Meta
Meta’s December quarter results and guide provided the latest evidence that AI is materially accelerating the business at scale, boosting shares by 6% in after hours following a 5% move higher over the past week. The outlook for revenue growth was impressive, borderline hard to believe, calling for 33% growth at the high end of the range, an acceleration from 24% in the just reported December quarter. If they deliver on projections, revenue growth would be the highest since September of 2021, off a sales base that has about doubled over the past five years, pushing the law of large numbers to the side. Additionally, AI is improving engagement across the Family of Apps, up 7% y/y to 3.6B daily users. In September of 2024, DAU growth was 4.8%, representing faster growth off a bigger base. Lastly, Zuckerberg hinted that more products will come in the months ahead from Superintelligence Lab, which we believe will include a new foundational model.

Key Takeaways

1
March guidance implies up to 33% y/y revenue growth, which would be the fastest growth rate since September 2021, despite Meta’s revenue base having roughly doubled since then.
2
Family Daily Active People (DAP) reached 3.58B in December, up ~7% y/y, continuing a steady re-acceleration in engagement driven by AI-improved relevance.
3
CY26 capex guidance implies up to an 85% y/y increase, materially above prior Street expectation of 57%, signaling high confidence in AI returns.
4
Meta Superintelligence Labs remains early but strategically important with Zuckerberg emphasizing the need to build and control frontier models as a competitive advantage.
1

Revenue Growth

Meta’s revenue growth is the clearest proof yet that AI is working at scale. March-quarter revenue guidance of $53.5–$56.5B implies up to 33% y/y growth, accelerating from 24% just reported. If achieved, this would represent Meta’s fastest growth since September 2021 despite the business now being roughly twice as large.

The company highlighted on the call the sales growth inflection reflects AI-driven gains in ad relevance, conversion, and monetization efficiency across the Family of Apps, reinforcing that improvements in product quality are translating directly into higher revenue growth.

2

Family Daily Active People (DAP)

Engagement continues to strengthen, reinforcing the durability of the ad flywheel. DAP reached 3.58B (about 60% of the daily internet usage) in December, up 7% y/y, with growth re-accelerating versus recent quarters. Notably, DAP growth has steadily improved from 5% in late 2024 to nearly 7% today, a rare outcome at this scale and clear evidence that Meta is beating the law of large numbers.

Here’s DAP y/y growth by quarter:

  • Sep 24: 4.8%
  • Dec 24: 5.0%
  • Mar 25: 5.9%
  • Jun 25: 6.4%
  • Sep 25: 7.6%
  • Dec 25: 6.9%

The steady climb in DAP growth is consistent with AI-driven improvements in ranking and personalization making feeds more relevant and products more habit-forming, supporting Meta’s ability to compound engagement and monetization even as the user base approaches 4B people.

3

Capex

Management signaled a materially higher investment posture, with CY26 capital expenditures potentially up 85% y/y versus the Street’s prior expectation of 57%. The message is clear. Meta is using the strength of the core business to press its advantage in AI, while still expecting 2026 operating income to exceed 2025 in absolute dollars. This up 85% compares to Microsoft at up 40%, Google up 30% and Amazon up 17% in CY26.

This increase underscores how early we are in AI. Despite a significant infrastructure ramp in 2025, demand for AI compute continues to outpace supply, with constraints likely to persist through much of 2026. Meta has enough data by now to understand the relationship between Capex and revenue growth, and the company’s increasing confidence off a high base sends a message to all companies that we are still early in AI.

4

Meta Superintelligence Labs

Zuck’s bet on Meta Superintelligence Labs reinforces his view on the long-term AI upside. While on the call he intentionally stopped short of giving details, he emphasized the importance of building and controlling frontier models. My read through is over time they will have a model that better competes with GPT, Gemini and Grok.

In the Q&A, Zuckerberg was explicit that owning a general-purpose, frontier model is foundational to Meta’s strategy. He framed Meta as a “deep technology company,” arguing that building and controlling the underlying models is what enables differentiated products, rather than being “constrained to what others in the ecosystem are building or allow us to build.”

Importantly, he noted that frontier AI “is not going to always be available through an API to everyone,” making internal ownership critical both competitively and strategically.

The bottom line is that Meta views control of frontier models not as optional R&D, but as essential to shaping future consumer experiences and sustaining long-term business differentiation.

Disclaimer

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