Meta (META) Stock Trades Up, Here Is Why

What Happened?

Shares of social network operator Meta Platforms (NASDAQ:META) jumped 3.5% in the afternoon session after renewed enthusiasm for Alphabet reinvigorated the artificial intelligence trade, propelling a market rebound heading into the Thanksgiving holiday. 

The Nasdaq index jumped 2.6% and the S&P 500 gained 1.6%, driven by a 5% rally in Alphabet following the announcement of its upgraded Gemini 3 AI model. This optimism spilled over into the broader tech sector. The rally built on momentum from the previous trading session, sparked by the New York Fed president keeping the door open for a December interest rate cut.

The shares closed the day at $613.30, up 3.2% from previous close.

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What Is The Market Telling Us

Meta’s shares are not very volatile and have only had 7 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

The previous big move we wrote about was 25 days ago when the stock dropped 12.2% on the news that its third-quarter 2025 earnings report revealed a significant miss on profits due to a one-time tax charge, alongside declining margins and merely in-line revenue guidance, which overshadowed its strong sales growth. 

While the company posted a 26.2% year-over-year increase in revenue to $51.24 billion, beating analyst expectations, its reported earnings per share (EPS) of $1.05 missed estimates by 84.3%. The sharp drop in profit was due to a one-time, non-cash income tax charge of $15.93 billion. Excluding this charge, diluted EPS would have been $7.25, ahead of consensus. 

However, investors were also focused on other areas. The company's revenue guidance for the upcoming quarter was only in line with Wall Street expectations, suggesting growth might not accelerate further. 

Furthermore, profitability metrics showed some weakness, with both operating and EBITDA margins declining compared to the same quarter last year, indicating rising costs. The combination of the jarring headline profit miss and lukewarm forward guidance left investors wanting more, leading to the stock's decline.

Meta is up 2.5% since the beginning of the year, but at $614.06 per share, it is still trading 22.3% below its 52-week high of $790 from August 2025. Investors who bought $1,000 worth of Meta’s shares 5 years ago would now be looking at an investment worth $2,217.

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