Meta Shatters Earnings Expectations: Tap These Top-Tier ETFs
Summary:
Facebook’s parent company Meta Platforms META has reported better-than-expected second-quarter 2025 results, beating estimates on both the top and bottom lines. The company’s shares jumped 12.1% in after-market hours to new all-time highs as investors were impressed with its growing advertising business and a rise in users across its family of platforms.
Meta Exceeds Estimates with Strong Q2 Earnings
Meta Platforms META, the parent company of Facebook, reported better-than-expected second-quarter 2025 results on July 30, beating estimates on both the top and bottom lines. The company’s shares jumped 12.1% in after-market hours to new all-time highs as investors were impressed with its growing advertising business and a rise in users across its family of platforms.
The growth was largely driven by Meta’s AI advancements in its advertising offerings, such as smarter ad recommendations and campaign automation. Currently, over 4 million advertisers use the AI-powered Advantage+ campaigns, achieving a 22% improvement in returns. Building on this success, Meta plans to enable brands to fully create and target ads using AI by the end of 2026.
Meta’s global daily active users on at least one of the family of services (Facebook, WhatsApp, Instagram or Messenger) increased 6% year over year to 3.48 billion as of June. The world’s largest social media platform projects revenues in the range of $47.5-$50.5 billion for the third quarter.
The company raised its 2025 capital expenditure guidance to $66-$72 billion, up from the prior outlook of $64-$72 billion, reflecting its aggressive investments in AI infrastructure and technical talent. Among these efforts, Meta is investing hundreds of billions of dollars in building large-scale AI data centers, including a flagship facility named Hyperion, which will eventually scale to 5 gigawatts of capacity.
ETFs that Invest in Communication Services Sector
Investors seeking to tap the growth should consider ETFs with a large allocation to this social media giant. These include:
- Global X PureCap MSCI Communication Services ETF (GXPC)
- Vanguard Communication Services ETF (VOX)
- Fidelity MSCI Communication Services Index ETF (FCOM)
- iShares Global Comm Services ETF (IXP)
- Communication Services Select Sector SPDR Fund (XLC)
These ETFs provide exposure to companies in the communication services sector, including social media, search engines, telecommunication services, and more. Each of these ETFs has its own unique characteristics, fees, and investment strategies.
Analysis of Top Holding Portfolios
Each of the top holding portfolios for these ETFs is worth analyzing in depth. For example:
- Global X PureCap MSCI Communication Services ETF (GXPC) holds 24 securities with Meta occupying the top spot at 28.4% shares.
- Vanguard Communication Services ETF (VOX) targets the communication sector by tracking the MSCI US Investable Market Communication Services 25/50 Index, holding 118 stocks in its basket, with Meta Platform taking the top spot with a 23.9% share.
- Fidelity MSCI Communication Services Index ETF (FCOM) follows the MSCI USA IMI Communication Services 25/50 Index, holding 105 stocks in its basket, with Meta Platforms occupying the top position at 23.9%.
- iShares Global Comm Services ETF (IXP) provides global exposure to companies in media, entertainment, social media, search engine, video/gaming and telecommunication services by tracking the S&P Global 1200 Communication Services 4.5/22.5/45 Capped Index, holding 69 stocks in its basket, with Meta Platforms taking the top spot at 21.8% share.
Conclusion
The strong second-quarter earnings report from Meta Platforms is a testament to the company’s growing advertising business and increasing user base across its family of platforms. The company’s planned investments in AI infrastructure and technical talent are expected to drive further growth in the future. Investors seeking exposure to this social media giant should consider ETFs such as those listed above, which provide a convenient way to tap into the communication services sector.
The investment landscape is rapidly changing, with more investors turning to exchange-traded funds (ETFs) for diversification and cost savings. Whether you’re an experienced investor or just starting out, understanding the unique benefits of ETFs can help you make informed decisions about your portfolio.
Investing in Communication Services Sector
The communication services sector has been a bright spot in recent years, driven by growing demand from social media companies like Meta Platforms. An investment in this space is expected to bring high returns due to AI growth and user base expansions.
