Meta Q2 earnings: AI spending in focus for Wall Street, with the stock down 10% in 2026 (www.businessinsider.com)

Meta is set to release its second-quarter earnings, with a significant focus on its AI investments. The company, part of the "hyperscalers" driving substantial spending in AI technologies, will provide insight into its capital expenditures—key figures closely watched by investors. This comes in the wake of Alphabet and Tesla's disappointing stock reactions to their own earnings reports, primarily due to increased spending outlooks. With Meta's stock down 10% year-to-date, the earnings call will be crucial for investors seeking to gauge the effectiveness of the company's AI initiatives. Analysts predict Meta will report Q2 revenues of $60.23 billion, including an estimated $59.07 billion from advertising. Operating income is expected to be around $21.5 billion, but Reality Labs may post a substantial operating loss of $4.45 billion, highlighting the financial challenges of its metaverse efforts. As the company aims to leverage AI for enhanced advertising and user engagement, the results could influence market sentiment around AI investments and prompt a reevaluation of strategies among competitors in the tech sector.