META Beats on Q4 Earnings, Plans Big Spending: ETFs in Focus

After the closing bell on Jan. 29, Facebook’s parent company, Meta Platforms META came up with better-than-expected fourth-quarter 2024 results, beating on both the top and bottom lines. The company forecasts a slowdown in revenue growth for the current quarter and said expenses in 2025 will grow faster than last year.META shares dropped 5% initially in after-market hours and recovered later to close up about 2%. ETFs with a large allocation to this social media giant are in focus. These include iShares Global Comm Services ETF IXP, Fidelity MSCI Communication Services Index ETF FCOM, Vanguard Communication Services ETF VOX, Communication Services Select Sector SPDR Fund XLC and First Trust Dow Jones Internet Index Fund FDN (see: all the Communication ETFs here).Earnings in FocusAdjusted earnings per share came in at $8.02, topping the Zacks Consensus Estimate of $6.68 and increasing 49% from the year-ago quarter. Revenues grew 21% year over year to $48.39 billion and came above the estimated $46.97 billion. Meta’s global daily active users on at least one of the family of services (Facebook, WhatsApp, Instagram or Messenger) increased 5% year over year to 3.35 billion as of December. CEO Mark Zuckerberg said 2025 will “be the year when a highly intelligent and personalised AI assistant reaches more than 1 billion people, and expects Meta AI to be that leading AI assistant.”Meta continues to boost its capital expenditures, doubling down on its AI infrastructure and metaverse ambitions. It plans $60-$65 billion in capex in 2025, above Wall Street's estimate of $52.41 billion. Total expenses are expected to come in the range of $114-$119 billion, with the bulk of the spending related to its infrastructure costs.The world’s largest social media platform projects revenue growth to slow down in the current quarter. It expects to post revenues in the range of $39.5-$41.8 billion for the first quarter, reflecting 8%-15% year-over-year growth. The Zacks Consensus Estimate is pegged at $41.60 billion.ETFs in FocusiShares Global Comm Services ETF (IXP)  iShares Global Comm Services ETF provides global exposure to companies in media, entertainment, social media, search engine, video/gaming and telecommunication services by tracking the S&P Global 1200 Communication Services 4.5/22.5/45 Capped Index. It holds 66 stocks in its basket, with Meta Platforms taking the top spot at 23.4% share. iShares Global Comm Services ETF has amassed $409.4 million in its asset base while trading at an average daily volume of 15,000 shares. The expense ratio is 0.41%. IXP has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.Fidelity MSCI Communication Services Index ETF (FCOM) Fidelity MSCI Communication Services Index ETF follows the MSCI USA IMI Communication Services 25/50 Index. It holds 109 stocks in its basket, with Meta Platforms occupying the top position at 22.6%. Fidelity MSCI Communication Services Index ETF has amassed $1.4 billion in its asset base and trades in an average daily volume of 136,000 shares. It charges 8 bps in annual fees and has a Zacks ETF Rank #3 with a Medium risk outlook (read: Disney's Moana 2 Smashes Box Office on Debut: ETFs to Tap).Vanguard Communication Services ETF (VOX)Vanguard Communication Services ETF also targets the communication sector by tracking the MSCI US Investable Market Communication Services 25/50 Index. Holding 117 stocks in its basket, Meta Platform takes the top spot with a 22% share. Vanguard Communication Services ETF has AUM of $4.7 billion and trades in a good volume of 132,000 shares a day, on average. It charges 10 bps in annual fees and has a Zacks ETF Rank #3 with a Medium risk outlook.Communication Services Select Sector SPDR Fund (XLC) Communication Services Select Sector SPDR Fund offers exposure to companies from telecommunication services, media, entertainment and interactive media & services and has accumulated $21.2 billion in its asset base. It follows the Communication Services Select Sector Index and holds 22 stocks in its basket, with Meta Platforms occupying the top position at 20.1% share. Communication Services Select Sector SPDR Fund charges 9 bps in annual fees and trades in an average daily volume of 4 million shares. It has a Zacks ETF Rank #1 (Strong Buy).First Trust Dow Jones Internet Index Fund (FDN)First Trust Dow Jones Internet Index Fund follows the Dow Jones Internet Composite Index, giving investors exposure to the broad Internet industry. It holds about 40 stocks in its basket, with Meta Platform occupying the top spot at 10.5%. First Trust Dow Jones Internet Index Fund is the most popular and liquid ETF in the broad technology space, with AUM of $7.2 billion and an average daily volume of around 345,000 shares. FDN charges 51 bps in fees per year and has a Zacks ETF Rank #1 with a High risk outlook.Want key ETF info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.Get it free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report First Trust Dow Jones Internet ETF (FDN): ETF Research Reports Vanguard Communication Services ETF (VOX): ETF Research Reports Fidelity MSCI Communication Services Index ETF (FCOM): ETF Research Reports iShares Global Comm Services ETF (IXP): ETF Research Reports Communication Services Select Sector SPDR ETF (XLC): ETF Research Reports Meta Platforms, Inc. 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