New York, February 20, 2026, 10:29 EST — Regular session
- Meta Platforms picked up roughly 1.4% during early U.S. trading.
- Investors are treating the youth social media addiction trial—where Zuckerberg took the stand for questioning—as a potential bellwether.
- Meta has scaled back employee stock awards, a move coming as the company boosts its AI investments, according to a separate report.
Meta Platforms climbed 1.4% to $653.84 Friday morning, echoing strength in big tech. Investors are digesting heightened court scrutiny of Meta’s apps, along with new hints of tighter cost controls.
Meta’s shares are moving as legal worries resurface, just as the company pours money into ramping up its AI infrastructure. It’s a tricky combination—lawsuits might grind on for ages, but those data center invoices don’t wait.
Traders are picking through the chatter, hunting for real information. A change in compensation might reveal just how aggressively Meta wants to drive its spending agenda—and if the company’s leaders are prepared to make cuts in other areas to protect margins.
Chief Executive Mark Zuckerberg, taking the stand in Los Angeles this week, told jurors that Meta bars users under 13 from Facebook and Instagram—even as a plaintiff’s lawyer pressed him with internal records. Zuckerberg pushed back, accusing the lawyer of “mischaracterising what I am saying.” He noted age verification is a tough problem for app makers, and pointed out that “one side effect” of improving products is simply that people might use them more. Reuters
Meta pushed higher, joined by Alphabet, and Snap made a move up as well. Apple edged up just a bit, while Nvidia barely budged.
The Financial Times says Meta has shaved about 5% off most employees’ annual stock-option awards, following an even bigger reduction last year. Meta wouldn’t comment, according to Reuters. Back in January, the company projected capital expenditures for 2026 in the range of $115 billion to $135 billion, targeting upgrades like new data centers and servers to support AI.
For equity investors, that spending figure remains front and center. Sure, the ad business generates plenty of cash, but capex on this level puts a squeeze on free cash flow—particularly if those new AI products are slow to deliver returns.
Hardware’s grabbing attention again. According to Reuters, Meta is dusting off its “Malibu 2” smartwatch project, now targeting a 2026 launch. The device is set to feature health tracking and a native Meta AI assistant. This marks a renewed push into wearables, after Reality Labs’ focus on the metaverse earlier slowed momentum. Reuters
Meta’s latest wearable play edges the company further into Apple’s territory in both health and hardware, keeping it in the thick of competition over where AI lands—whether that’s phones, glasses, or wrists. In the Los Angeles case, Meta is joined by Alphabet’s YouTube as a co-defendant.
The risk is obvious: a negative verdict—or a trial outcome that sparks similar lawsuits—might push up risk premiums for social-media stocks. And if AI investment keeps climbing while ad demand fades, companies could face harder decisions on expenses and staffing.
Investors are eyeing upcoming trial updates and looking for any fresh comments from the company that clarify its approach to spending and pay. Meta is on track to release its next earnings report April 29, per Investing.com.
