12:12 PM EDT, 07/25/2024 (MT Newswires) -- Meta Platforms ( META ) is expected to report a modest beat in Q2 results on Wednesday, driven by strong performance in Reels and messaging, BofA Securities said in a note Thursday.

"We remain positive on Meta & think Reels, Messaging, & AI driven ad improvements are still early, and could lead to positive product surprises & revenue upside," BofA said.

BofA expects Meta Platforms ( META ) to report quarterly revenue of $38.5 billion, topping the Street consensus of $38.3 billion, and earnings of $4.98 per share, surpassing the Street forecast of $4.69.

For Q3, revenue guidance is expected between $37.5 billion and $40.5 billion, compared to the Wall Street's $39.1 billion, BofA said, adding that expenses are forecasted to remain at $96 billion to $99 billion, with capital expenditures steady at $35 billion to $40 billion.

Risks include an unexpected slowdown in Q3, potential reduced Reels revenue growth, cautious commentary on European Union regulatory challenges, and possible higher capex or significant depreciation expense in 2025, BofA added.

BofA maintained a buy rating on Meta Platforms ( META ) with a price objective on $550.

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