Meta drops its fourth-quarter earnings Wednesday, and Wall Street's laser-focused on one question: Is the company's radical AI overhaul worth the staggering price tag? After spending $14.3 billion to acquire Scale AI's leadership and another $6 billion commitment for data center fiber optics, CEO Mark Zuckerberg faces skeptical investors who want proof that this massive pivot will deliver returns. The social media giant completely restructured its AI division in 2025 following Llama 4's lukewarm reception, betting everything on a new frontier model code-named Avocado that's set to launch in the coming months.
Meta just put all its chips on AI, and Wednesday's earnings call will show if Mark Zuckerberg's billion-dollar bet is already paying dividends or if investors should brace for a costly waiting game.
The numbers tell part of the story. Analysts polled by LSEG expect revenue of $58.59 billion and earnings per share of $8.23 for the fourth quarter. But those figures are table stakes compared to what Wall Street really wants to hear: concrete evidence that Meta's dramatic AI restructuring justifies the eye-watering capital expenditures that have sent some investors running for the exits.
Meta spent 2025 completely overhauling its artificial intelligence operations after Llama 4 landed with a thud last spring. Developers gave the model a tepid reception, forcing Zuckerberg to confront an uncomfortable reality - Meta was losing ground to OpenAI and Google in the AI arms race that's reshaping Big Tech.
The company's response was characteristically aggressive. Meta primarily to acquire the startup's founder, Alexandr Wang, and his top talent. Wang now runs Meta's elite TBD unit, the internal group tasked with developing frontier AI models that can compete with GPT-5 and Google's latest offerings.
