03:54 PM EDT, 10/30/2025 (MT Newswires) -- Meta Platforms' ( META ) updated annual expense guidance and a nearly $16 billion tax charge booked in the third quarter prompted UBS Securities on Thursday to scale back its 2025 earnings expectations for the technology giant.

Late Wednesday, the Facebook and Instagram parent disclosed a one-time non-cash income tax charge of $15.93 billion related to the implementation of US President Donald Trump's One Big Beautiful Bill Act. As a result, the company reported per-share earnings of $1.05 for the September quarter, compared with $6.03 a year earlier and a FactSet-polled consensus of $6.72. Excluding the tax charge, EPS would have been $7.25, according to Meta.

The company revised its outlook for 2025 expenses to between $116 billion and $118 billion from its prior outlook range of $114 billion to $118 billion, indicating annual growth of 22% to 24%. Full-year capital expenditures are now pegged at $70 billion to $72 billion, compared with its prior guidance range of $66 billion to $72 billion.

UBS now estimates Meta's EPS at $22.56 this year, down from its previous expectations of $28.90. The brokerage, however, increased its EPS views for 2026 and 2027.

Meta's shares were down nearly 12% in Thursday late-afternoon trade. The stock has increased 14% so far this year.

The company expects capex dollar growth to be "notably larger" in 2026 than this year, while total expenses are likely to grow at a significantly faster percentage rate, Chief Financial Officer Susan Li said in a statement.

"A hike in the midpoint of 2025 cost guidance and commentary that suggests higher intensity for 2026 causes us to take up our capex and total expense trendlines for 2025 and beyond," UBS analysts, including Stephen Ju, said in a Thursday note to clients. "Although the (generative artificial intelligence) build costs sting today, we maintain our buy rating on Meta shares given our view that the path to lighting up several new revenue vectors remains clear."

The brokerage increased its price target on the Meta stock to $915 from $900. The social media giant flagged "broad-based strength across verticals" in the September quarter, according to the note. "We remain confident about Meta's underlying trajectory," the analysts said. UBS raised its annual revenue projections for the company through 2027.

For the ongoing quarter, Meta expects revenue of $56 billion to $59 billion. Wall Street is looking for $58.01 billion.

"We expect the set of investments we are making within our ads and organic engagement initiatives next year will enable us to continue to deliver strong revenue growth in 2026, while our progress on AI models and products will position us to capitalize on new revenue opportunities in the years to come," Li said.

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