Fa Ba: Meta (META.US) is expected to realize its computing power monetization potential, with cloud visions in addition to advertising growth.

After meeting with the companys management, the investment institution BNP Paribas believes that Meta Platforms (META.US) has considerable potential for monetizing its computing assets. Analyst Nick Jones wrote in a report to clients: The management believes that the economic benefits of monetizing AI capabilities are far better than simply selling raw computing power. Meta will only use its computing power for cloud service deployment when internal demand is lower than expected, and such collaborations will primarily focus on short-term or strategic projects. Jones further pointed out that, given the clear market opportunities, Meta is actively investing in multiple AI projects and continuously expanding its computing power capacity. However, management is also aware that the supply side may face certain restrictions due to the macro-political environment in 2028 and beyond. In depth, Jones believes that Meta's core advertising business will maintain "sustained" growth, while other revenue sources, including potential cloud services, will also drive overall revenue to achieve "steady" growth. Although capital expenditures may continue to expand until 2027, we believe that in the long run, these investments will generate sufficient revenue to support its capital expenditure scale," Jones added. "On the basis of cost control, we expect the company's profit margins to return to an expansion track. Jones set a target price of $855 for Meta and gave it an "outperform" rating. Last month, it was reported that Meta is planning its cloud computing business, aiming to sell its surplus computing power externally. Meta CEO Mark Zuckerberg indicated to investors at the shareholder meeting in May this year that selling surplus computing power is being considered. This is indeed within the scope of discussion, Zuckerberg stated. However, he also added that Meta has yet to take action as the company believes it still has a practical need for this computing power.