Shares of social media giant Meta Platforms (META 2.52%) and streaming leader Netflix (NFLX 0.73%) are both down so far in 2026, but the drawdown has not been comparable. Netflix has fallen by about 17% year to date, while Meta has been closer to flat to modestly lower.
If you think that Netflix's sharper decline makes it the automatic choice when comparing the two growth stocks, think again.
Netflix's business is still growing, and its outlook is solid. But Meta's latest guidance and investment plans point to a far more attractive growth profile.
Here's why Meta is my pick for the long haul -- not Netflix.
Image source: Getty Images.
Meta: growth -- and a big reinvestment plan
Meta's fourth-quarter results were strong on the surface. Revenue rose 24% year over year to $59.9 billion, helped by an 18% increase in ad impressions and a 6% rise in average price per ad. And total daily active users across its platforms averaged 3.58 billion in December, up 7% from a year earlier.
But the more decisive point came in the company's first-quarter revenue outlook. Meta guided for first-quarter revenue of $53.5 billion to $56.5 billion. Against last year's first-quarter revenue of $42.3 billion, the midpoint implies about 30% year-over-year growth.
That is an unusually high growth rate for a company of this size.
And what's perhaps even more surprising is that the company is investing like it's a growth company in its early innings. Meta said it anticipates 2026 capital expenditures of $115 billion to $135 billion and full-year total expenses of $162 billion to $169 billion.
The biggest driver behind its massive spending spree? AI.
"We are now seeing a major AI acceleration," explained Meta CEO Mark Zuckerberg during the company's fourth-quarter earnings call. "I expect 2026 to be a year where this wave accelerates even further on several fronts."
Meta is convinced there is a significant opportunity to expand its business with AI, and it is investing accordingly.
Such an aggressive investment stance, of course, entails risks. If ad demand cools or pricing weakens at the wrong time, Meta's expense ramp gives investors less cushion.
Netflix: growth cools as spending rises
Netflix's fourth-quarter results were impressive, featuring revenue rising 17.6% year over year to $12.1 billion. And the company crossed 325 million paid memberships during the quarter.
Revenue growth also notably ticked up slightly from the third quarter, when Netflix posted 17.2% year-over-year growth.
But Netflix's forecast points to a step-down. Management's first-quarter revenue forecast of $12.2 billion implies 15.3% year-over-year growth.
Then there is the full-year setup, which highlights expectations for an even further slowdown. Netflix forecast 2026 revenue of $50.7 billion to $51.7 billion, representing 12% to 14% year-over-year growth. That outlook is supported by membership and pricing, plus a projected rough doubling of ad revenue versus 2025.
Overall, Netflix is doing fine. The issue, however, is that not only is it already growing slower than Meta, but it's forecasting even slower growth going forward, even as it trades at a similar valuation to Meta.
NASDAQ: META
Key Data Points
Which is the better buy?
At a high level, both stocks trade at premium valuations. Meta's price-to-earnings ratio is around 27, and Netflix's is around 30.
But Meta is a faster-growing company with significant AI growth opportunities. And if Meta's heavy spending expands its capabilities and keeps its ad business compounding, the premium is easier to justify.
Netflix, meanwhile, is forecasting a step-down to 12% to 14% revenue growth in 2026.
If I'm choosing between these two today, I'd buy Meta over Netflix. Under what circumstances might I reconsider that view? If Netflix reaccelerates beyond its current 2026 growth range, or if Meta's spending surge doesn't yield the returns management hopes for.
