Worst outcome in Meta LA trial are structural changes to their apps: Big Technology's Kantrowitz
Watch on YouTube ↗  |  February 18, 2026 at 19:16 UTC  |  5:20  |  CNBC
Speakers
Alex Kantrowitz — Founder, Big Technology

Summary

  • Meta faces a "landmark" jury trial in Los Angeles regarding user safety and addiction; a loss could mandate "structural changes" to its apps (Instagram/Facebook) nationwide, not just monetary fines.
  • Unlike antitrust cases which rely on technical legal arguments, this case centers on emotional harm to children, which presents a significantly higher risk of a negative jury verdict.
  • YouTube (Google) is viewed as structurally safer than Meta in this legal environment because its "lean back" consumption model (similar to TV/Netflix) is perceived as less viscera/addictive than Meta's "active" feed loops.
  • The social media sector risks becoming analogous to legacy chemical or industrial companies (e.g., Honeywell), where chronic litigation and settlements become a permanent drag on valuation and investability.
Trade Ideas
Ticker Direction Speaker Thesis Time
META
SHORT Alex Kantrowitz
Founder of Big Technology 		Meta is facing a jury trial (not a judge) regarding the addiction of a minor. Kantrowitz notes, "If there are structural changes to the way that that company is able to run its app, that would be massive and fairly unprecedented." A jury is likely to be swayed by emotional testimony ("ruined a very young girl's life") unlike a judge in an antitrust case. A loss here sets a precedent for hundreds of pending cases. If Meta is forced to alter its algorithms (the "structural changes"), it fundamentally breaks the engagement loops that drive revenue. SHORT. The downside risk involves core product degradation, not just fines. Meta wins the case, or the judgment is limited to monetary damages rather than product injunctions. 0:05
GOOG /GOOGL
LONG Alex Kantrowitz
Founder of Big Technology 		When asked if YouTube faces the same risk, Kantrowitz stated, "I think YouTube will actually be able to fare better here." Public and jury perception distinguishes between "leaning back" to watch 30 minutes of content (YouTube/TV behavior) versus the "visceral," rapid-fire addiction loops of social feeds (Instagram/TikTok). This differentiation insulates Google from the most severe "addiction" litigation risks compared to Meta. LONG (Relative to META). Google is the safer play in the ad-tech/social space amidst this litigation wave. Discovery in future trials reveals internal documents showing YouTube explicitly engineered addiction loops similar to Meta. —
SNAP
NEUTRAL Alex Kantrowitz
Founder of Big Technology 		"Snapchat settled... because they didn't want to end up in a place that Zuckerberg is today." Snap avoided the immediate "headline risk" and the possibility of a precedent-setting loss by paying out early. While this protects them from the current trial's volatility, they still operate in the same "addictive" sector that is under fire. NEUTRAL. They made a tactical move to de-risk, but the sector overhang remains. "Cascading effects" from a Meta loss could lead to industry-wide regulation that hurts Snap regardless of their settlement. —