The speed of Meta Platforms' (META) earnings growth and profitability path of its Muse AI will be the biggest topics Gil Luria of D.A. Davidson will watch the closest. Meta's CapEx plans are still important as well, especially if the Mag 7 company plans on crating more enterprise scale AI products. Competition from Alphabet (GOOGL), Apple (AAPL), and OpenAI serve as a key headwind. That said, user optimization is something Gil sees as a tailwind for Meta and its user base of billions. Public perception around how Meta uses customer data is what he points to as a key ongoing risk.
======== Sc...
What Gil Luria said
Written from the verified transcript and checked against it. Every figure links to the moment it was said.
Gil Luria, Head of Research at D.A. Davidson, said Meta's upcoming earnings will hinge on the ad business, which has been gaining share from Google, and on metrics for the Muse AI app, which surpassed 10 million U.S. downloads in its first 40 days. He noted Meta's advantage is distribution and user experience, not the AI itself, and that monetization will likely come through advertising. Luria said Meta is attractive because it trades near 20 times earnings, a discount to Google, Amazon and Microsoft, despite faster revenue and earnings growth. He attributed stock volatility to Mark Zuckerberg's controlling interest and his investment decisions. On the reported $25 billion Cambridge Analytica ruling, Luria said Meta will appeal and settle for less, calling it a financial nuisance for a $2 trillion company, though product modifications remain a bigger risk. He argued hyperscalers like Meta are hedged to the AI trade because if AI sputters, their cash flow will skyrocket as they stop spending on data centers.
Key takeaways
Muse surpassed 10 million U.S. downloads in its first 40 days, but Meta needs far higher usage to meet expectations.
Meta trades near 20 times earnings, a discount to Google, Amazon and Microsoft despite faster revenue and earnings growth.
The reported $25 billion Cambridge Analytica ruling will likely be appealed and settled for much less, a nuisance for a $2 trillion company.
Hyperscalers like Meta are hedged to AI: if AI sputters, their cash flow will skyrocket as data center spending stops.
Meta's stock volatility stems from Zuckerberg's controlling interest and his choices between returning profits and investing in growth.
The news. All right, let's go deep on Meta. We want to preview today's earnings report. With me for this conversation, Gil Luria, Head of Research, D.A. Davidson. Thank you so much for being here. Today's the day Meta will report after the bell. How do you think this may be received? What are you waiting to hear from this company?
Yeah, there's a lot we want to learn. First and foremost, how the ad business is doing. It's been growing very fast. They've been gaining share from Google. Investors expect that to continue, therefore upside to numbers. But what's really important is to hear metrics about Muse. It's been such a success as an app based on AI, and really fulfilled the promises that Mr. Zuckerberg's been making for the last couple of years in terms of creating a compelling product that consumers want to use. So we're going to want to hear how many downloads, what the product roadmap looks like. That's going to be a big topic.
And then the next topic is going to be the possibility of an enterprise product. They hired the CEO, the former CEO of MongoDB. And when you hire someone like that, that usually means you intend to build a big business. And we want to hear about what the plans are for creating that big business. Are they just going to compete with Microsoft, Amazon and Google, or try to carve their own path? And then finally, we're going to want to hear how much it's going to cost us. So how much CapEx is planned for the next 12 months and what the guidelines are around that. All those pieces together will tell us how much progress Meta has made.
Yeah. And we think Muse and the possibility of penetration for how many billions of people are using Meta, and that it could in fact be a game changer there. Certainly this feels that it's more user friendly, it's for the regular folks. You know, each AI agent is a little bit different whether, you know, you're using different AI platforms, some more advanced, some more user friendly, etc. Do you anticipate that this could then, or are people expecting that to translate into billions for the company? And if they don't hear that, they'll be disappointed?
Muse surpassed 10 million U.S. downloads in the first 40 days. Does it have a high bar to reach? Yes, because in total, Meta Platforms has 3 or 4 billion users. And so 10 million is nice. But really to live up to expectations, they're going to have to get to much higher levels of usage. And that's not going to be easy because there's going to be other personal assistants from Google, from Apple, from OpenAI, possibly from Anthropic. Muse, the breakthrough really isn't the AI, to your point. It's the user experience. It's just it's a little friendlier to you. You could actually make the same request of ChatGPT or Claude. It just happens that Muse is a more user friendly way. And that's what Meta does. Meta is in the business of compelling consumers to stay on their platform and use their products. That's their advantage. Their advantage is that they have that experience and that they have the distribution. They have that existing billions of users that are on Facebook or Instagram or WhatsApp. And so investors will want to see that there's a plan to get from 10 million to far higher numbers, and then some plan for how to monetize that, though in Meta's case, that is likely through advertising.
You know what's interesting about this chart? I know you do a lot of research there at D.A. Davidson, and look at this chart and it's truly a roller coaster. You know, there's not really a lot of trends to it. It's this up and down and up and down, the tune of about $250 swing, from 520 up to 780 or so. But it really has been a choppy trade. Good enough that year to date it's higher, and one year it's lower, which doesn't surprise me based on the trade. Is this a time to step in for a name like Meta? Because, for example, the ad business, as you said, they're gaining some market share, CapEx spending is likely to continue, I guess. In your opinion, do you step in here on Meta?
6 more exchanges in this transcript
Sign in free to read the rest of this interview. No card required.
Luria, G. (2026, October 21). META Strong Opportunity in AI Faces Competition & Sentiment Headwinds [Interview transcript]. Schwab Network. CEOInterviews.AI. https://ceointerviews.ai/interview/3236949/
MLA
Gil Luria. "META Strong Opportunity in AI Faces Competition & Sentiment Headwinds." Schwab Network, 21 Oct. 2026. Transcript, CEOInterviews.AI, https://ceointerviews.ai/interview/3236949/.
BibTeX
@misc{luria2026_3236949,
author = {Gil Luria},
title = {META Strong Opportunity in AI Faces Competition \& Sentiment Headwinds},
howpublished = {Interview transcript, Schwab Network. CEOInterviews.AI},
year = {2026},
month = {oct},
url = {https://ceointerviews.ai/interview/3236949/},
note = {Speaker-attributed transcript with timestamps}
}
