Thursday was a painful day for the investors of Meta Platforms ( NASDAQ : META ), as the stock price fell by 7%, erasing all the gains made this year. Palantir ( NASDAQ : PLTR ) was no exception, with a 3% decline; however, considering the astonishing 1,111% increase over the past three years, this drop might still provide some context for comparison. Meanwhile, Roblox ( NYSE : RBLX ) managed to rise by 2.68% against the trend. Nevertheless, this gaming stock has still fallen by 58% in the past 12 months.
The AI of Meta is causing concern among investors.
However, the expenditure plan overshadowed these achievements and also raised concerns among investors about future profitability. Meta raised the lower limit of its capital expenditure forecast for 2026 by $5 billion, estimating that the investment scale will be between $135 billion and $145 billion. The social media giant also proposed a plan to issue a new class of non-voting shares, which further exacerbated market concerns regarding financing.
There may be potential rewards behind these commitments, especially as CEO Mark Zuckerberg is expanding his AI plan. The Muse assistants of Meta may ultimately generate revenue through advertising, subscriptions, and shopping services. However, with free cash flow turning negative for the first time since 2012, investors no longer seem willing to ignore the rising expenses.
The AI momentum of Palantir continues to attract Wall Street's attention.
Palantir has become one of the largest AI winners in the market, and recent financial reports have strengthened market expectations for its continued expansion. Revenue in the second quarter increased by 93% year-on-year to $1.94 billion, while sales in the U.S. soared by 149%. The company has raised its full-year performance forecast to $8.15 billion to $8.158 billion, providing investors with another reason to remain confident.
This enthusiasm largely stems from the AI Platform of Palantir, a platform that allows institutions to integrate advanced technologies into their daily operations. Government agencies continue to rely on its software for national defense, intelligence, and data analysis, while the adoption by commercial clients has also brought additional opportunities.
However, after experiencing astonishing years of growth, Palantir is facing high expectations, which leaves it with little room to tolerate disappointing financial results.
Overall, Wall Street has given Palantir a consensus rating of 'neutral to bullish', based on 18 buy ratings, 4 hold ratings, and 2 sell ratings. The average analyst target price is $212.33, which indicates there is still an 8% upside potential over the next 12 months. (See PLTR stock price forecast)
The rebound of Roblox faces new challenges.
Roblox Although it closed in the green on Thursday, its performance over a longer period is not optimistic. Despite concerns regarding profitability, slowing growth, and monetization, this gaming platform still finds it difficult to regain investors' confidence.
These concerns were evident in their second-quarter performance, and the financial report provided little comfort regarding short-term financial results. Reservations increased by 8% year-on-year, but Roblox expects a 14% to 18% contraction in the third quarter. Such guidance has raised concerns among the market about whether the company will be able to sustain its previous momentum.
Competition is also another challenge, especially after Meta launched a game creation tool driven by AI in September. These features allow users to build interactive experiences through simple text commands, which may pose a threat to Roblox's creator-centric ecosystem. Investors will now be looking forward to the upcoming financial reports to see if there has been any improvement in pre-orders, engagement, and monetization capabilities.
