Meta is projected to lose $7 billion in advertising revenue this year due to reduced spending from Chinese retailers like Temu and Shein, as a result of U.S.-China trade tariffs implemented during Trump's presidency. Analysts from MoffettNathanson emphasize that China's contribution to Meta's revenue is significant, and any further economic downturn or trade tensions could exacerbate this loss, potentially leading to a $23 billion decline in ad revenue for 2025. Despite these challenges, they maintain a Buy rating on Meta, albeit with a lowered target price.

Meta Platforms' shares jumped 11% after the company forecasted third-quarter revenue exceeding analysts' expectations, driven by advancements in artificial intelligence for its advertising business. Despite rising capital expenditures and scrutiny over its aggressive AI spending, investor confidence remains bolstered by the company's commitment to AI development.