Meta’s 20-Day Streak Shattered: What’s Next for the Tech Giant?

Recently, a notable shift in Meta Platforms Inc. (META) stock performance caused shock and confusion for many investors. Meta stock declined by 2.8% on Feb. 18, 2025, closing at $716.37. This was the first day the tech giant has closed in the red in nearly a month, ending a record-breaking 20-day winning streak. This change in performance leaves many stunned and wondering what may have brought an end to this rally and what the implications are for the company’s future. Will Meta go on another record-breaking run, or is this a sign of long-term disaster for the company?

Meta broke records as it surged to its peak of $737.67 on Friday, Feb. 14. This completed a 20-day streak of closing in the positive, a new record for the Facebook parent. According to Yahoo Finance, the previous record for the Facebook parent company was back in 2015, when stocks rose for 11 consecutive days. The rally was largely driven by the overwhelmingly positive reaction to Meta’s fourth-quarter results, which arrived at the end of January. Meta beat analyst expectations for sales and earnings, instilling significant confidence in investors. 

Additionally, before the quarterly report was released, Chief Executive Mark Zuckerberg promised to significantly increase investment in AI development. Zuckerberg announced that META would spend up to $65 billion on capital expenditures this year, focusing on AI infrastructure. This figure surpassed previous estimates, which may explain the excitement among investors. Zeus Kerravala, founder of ZK Research, noted, “They’ve used [their AI investments] largely to drive their business where … other companies have been trying to be a little bit more all things to all people”. This strategic move aims to enhance Meta’s competitiveness in the AI sector, appealing to investors who are optimistic about the company’s future prospects.

Despite this, things quickly took a turn for the worse. Between Feb. 22 and Feb. 26, META stock dipped by 5% and continues to decline. While no single cause exists for the reversed market trend, several factors may have contributed. 

On Feb. 14, Meta Platforms revealed that it had approximately 46.8 million average monthly active users on the WhatsApp platform over the six-month period that concluded on Dec. 31. While growth may seem like a great sign to investors, it caused WhatsApp to now be subject to the European Union’s Digital Services Act. The DSA defines a “very large online platform” as a service that reaches at least 10% of the EU’s population, around 45 million people monthly. Since crossing this threshold, Meta will be subject to tighter government regulations, something that no shareholder wants to hear. 

However, many analysts suggest an even simpler explanation for the dip in Meta’s stock. After a prolonged period of gains, investors might have engaged in profit-taking, leading to the pullback. Profit-taking, simply put, is when an investor elects to lock in gains after a stock has risen considerably. While impossible to say with certainty, it wouldn’t be a surprise for many to seek a return on their investment — especially with the stock reaching an all-time high at $736.67 on Feb. 14.

So, Meta’s stock dipping dramatically for the past two weeks is not as frightening as it may seem. While Meta’s historic 20-day winning streak was remarkable, it was bound to face a correction at some point. Whether this recent decline signals the start of a prolonged downturn or just a temporary pullback remains to be seen. Investors should remember that no stock moves in a straight line, and volatility is a natural part of the market cycle. Despite this, thanks to its massive investments in artificial intelligence and continued success as a social media platform that returns great numbers in ad revenue, Meta has excellent growth potential even in the face of increased government regulation. 

Ultimately, the recent drop in Meta’s stock serves as a reminder that even the most dominant companies are not immune to market fluctuations — a clear example of the inherent volatility in the stock market. All investors should consider the potential risks before jumping at a seemingly perfect opportunity to make money. Risk and reward must also be considered throughout the investment holding period, as it informs whether one should hold, buy more or cash out. As history has shown, Meta has been able to rebound from setbacks, but only time will tell if another record-breaking run is on the horizon or if this marks the beginning of a more cautious era for the tech giant.

Photo Caption: Meta Logo

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