Meta Platforms (META), the social media and technology giant, will release its second-quarter financial results on Wednesday, July 30, after market close. Despite some broader concerns about the impact of tariffs on digital advertising, Wall Street remains bullish on Meta stock and has a “Strong Buy” consensus rating ahead of earnings.

Over the past three months, Meta shares have climbed roughly 30%, significantly outpacing the broader market. The recent rally has helped the stock recover from earlier pullbacks, but technical indicators suggest there’s still room to run. Meta’s 14-day Relative Strength Index (RSI) sits at 52.73, well below the 70 threshold that typically signals overbought conditions. It indicates that the stock may have further upside potential without being overheated.

Supporting analysts’ optimism and the recent recovery in Meta stock is the resilience of the company’s core business. Despite macroeconomic headwinds, Meta continues to deliver solid ad revenue growth and rising user engagement across its platforms.

A major driver of this strength is Meta’s rapid integration of artificial intelligence (AI) across its ecosystem. The company’s strategic advancements in AI are reshaping user experiences, enhancing features like personalized feed recommendations and dynamic video suggestions. These innovations are prolonging user sessions and bolstering ad monetization opportunities.

Meta’s focus on AI has been instrumental in expanding its user base, evidenced by a 5.9% year-over-year increase to 3.43 billion daily active people (DAP) in Q1 2025. However, while AI-driven initiatives are expected to drive Meta’s growth, fluctuations in ad revenue growth could keep the stock volatile post earnings.

Anticipation of such outcomes is reflected in the options market, where traders are pricing in a potential movement of approximately 5.28% following the earnings announcement. This figure exceeds Meta’s average earnings swing of 3.67% over the last four quarters, reflecting expectations for heightened post-earnings volatility.

Meta to Again Deliver Solid Growth

Meta Platforms is heading into its second-quarter earnings with strong momentum, driven by increasing user engagement, a growing ad business, and promising advances in AI. The company has projected second-quarter revenue between $42.5 billion and $45.5 billion, which represents a year-over-year increase of 9% to 16%. This signals continued demand for Meta’s platform and advertising services.

Key to this growth is the company’s focus on enhancing user experience through AI-powered content recommendations. Over the past six months, Meta has significantly improved its AI systems, resulting in a 7% increase in time spent on Facebook, a 6% jump on Instagram, and a 35% boost on Threads. Notably, Threads, Meta’s newest social platform, has surpassed 350 million monthly active users.

Looking ahead, Meta is betting big on its AI future. Its new personal assistant, Meta AI, is still in its early days but is already nearing 1 billion monthly active users. In the long term, Meta plans to monetize it through personalized product recommendations, advertising, and subscription-based features. If successful, this could evolve into a high-margin revenue stream and add another layer to Meta’s income portfolio.

Meanwhile, Meta’s advertising technologies are also benefiting from AI integration. The rollout of a new Generative Ads Recommendation model is improving ad performance and conversion rates. The continued adoption of Meta’s Advantage+ suite, which uses AI to optimize ad targeting, reflects growing confidence in these tools among advertisers.

While the company is poised to deliver strong revenue growth in Q2, Meta’s ongoing efforts to streamline operations and reduce costs are expected to support earnings. Analysts are forecasting earnings per share of $5.83 for Q2, up approximately 13% from the same period last year. Notably, Meta has exceeded earnings estimates for four consecutive quarters, most recently delivering a 23% beat.

With expanding user engagement, strengthening ad tools, and new revenue opportunities in AI, Meta is entering the second quarter in a strong position. The pieces are in place for another quarter of solid results and potentially another positive surprise.

Is Meta Stock a Buy?

With strong momentum heading into Q2 earnings, Meta Platforms appears well-positioned to deliver another quarter of solid performance. The company’s expanding user base, resilient ad revenue, and accelerating AI innovations position it to deliver solid growth. While short-term volatility is possible, especially given elevated expectations, the longer-term outlook remains constructive.

Meta’s combination of operational strength, strategic focus on AI, and a history of beating expectations makes a compelling case to stay bullish on its stock, even amid near-term uncertainties.