Synchrony Aces The Quarter As Credit Fears FadeMeta Platforms NASDAQ: META reported third-quarter 2026 revenue growth of 26% as advertising demand, engagement gains and AI-driven improvements across its apps supported results, while expenses rose sharply due to a nearly $10 billion legal charge and continued infrastructure investment.
Chief Executive Officer Mark Zuckerberg said Meta’s family of apps reached 3.64 billion daily users during the quarter. Facebook and Instagram posted all-time highs in engagement, driven largely by video, while Threads surpassed X in monthly active users, according to Zuckerberg. WhatsApp also reached all-time highs in messaging activity.
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The AI Buildout Is Only 15% Complete—Here Is Where the Next Dollar Actually GoesThe company reported total revenue of $64.6 billion, up 26% from a year earlier on both a reported and constant-currency basis. Family of Apps revenue was $64.2 billion, including $63.1 billion in advertising revenue, which also rose 26%.
Total expenses increased 68% to $51.6 billion, including a $9.9 billion charge related to Meta’s August 2026 agreement with multiple state attorneys general. GAAP operating income fell 37% to $13 billion, while the operating margin was 20%. Excluding the legal charge, Chief Financial Officer Susan Li said operating income would have risen 11% year over year.
Meta Platforms' AI Comeback Faces an Earnings Test—And a $10 Billion ChargeNet income was $9.9 billion, or $3.83 per share. Capital expenditures, including principal payments on finance leases, reached $34.9 billion as Meta invested in servers, data centers and network infrastructure. Free cash flow was negative $2.1 billion for the quarter.
Advertising and engagement trends
Meta said ad impressions delivered across its services increased 10% year over year, while the global average price per ad rose 14%. Li attributed pricing gains to better ad performance and improved macroeconomic conditions compared with the prior-year period, partially offset by impression growth in lower-monetizing regions and surfaces.
Meta continued to emphasize the role of AI in improving content recommendations and ad performance. On Instagram, global time spent per user reached an all-time high and rose by double digits year over year, with growth in both Reels and Feed. Facebook Reels time spent also reached all-time highs globally and in the U.S.
Li said Instagram Reels relevance initiatives introduced during the quarter lifted Reels time spent by more than 4%. On Facebook, a new generative retrieval architecture was deployed to about one-quarter of unconnected Feed views and half of Reels views, contributing a 1% increase in Reels watch time.
In advertising, Meta said its Meta Generative Recommender system drove a nearly 2% increase in conversions across targeted Facebook Feed segments. The company also expanded its GEM ad-ranking model, which increased conversions by 1.7% for off-site conversion campaigns and 9.6% for app-ad conversion campaigns, according to Li.
Meta’s AI Business Assistant has also become a more active tool for advertisers. The company estimated that advertisers adopting its recommendations generated nearly 5% more conversions at the same cost per conversion and increased advertising spending by 9% relative to similar non-adopters.
Nearly 10 million advertisers used at least one of Meta’s generative AI advertising tools in the third quarter. Meanwhile, partnership ads surpassed a $15 billion annual revenue run rate after growing more than 97% year over year, Li said.
Muse agent expansion and monetization plans
Zuckerberg focused much of the call on Muse, Meta’s personal AI agent. He said more than 10 million people in the U.S. and Canada had set up Muse agents in roughly six weeks. About 25% of people who have set up Muse use it on a given day, according to Zuckerberg.
Shopping has been the most common Muse use case, with more than one-quarter of active users engaging in shopping and an average purchase size above $200. Zuckerberg later clarified that the commerce data includes travel purchases. Personal productivity and connections to services such as email and calendars were also among the leading use cases.
Meta has not yet launched Muse globally, with Zuckerberg citing the service’s compute intensity, the need for regional product optimization and the company’s desire to improve efficiency before broader expansion. Meta expects to improve Muse compute-cost efficiency by more than tenfold over the next year through measures including more efficient models, inference optimization and use of off-peak capacity.
The company expects Muse to remain free for most users, with revenue eventually generated through commerce fees paid by businesses, paid subscriptions for advanced models or additional token usage, and subscriptions for business features and workplace uses. Zuckerberg said the company plans to build enough capacity to serve more than 1 billion people over the next several years.
Meta is also developing enterprise offerings around its models, including an API, Muse Code and business agents. Li said Meta believes AI could create a diversified recurring revenue stream through subscriptions, usage-based APIs, messaging and other revenue sources, though the opportunity is expected to develop over multiple years.
Reality Labs, outlook and capital structure
Reality Labs revenue declined 6% to $443 million, as lower Quest headset sales were partially offset by growth in AI glasses revenue. Zuckerberg said Muse will begin coming to Meta Glasses next month and that the company expects subscriptions tied to glasses to increase.
Meta expects Reality Labs operating losses to decline to about $15 billion next year, following expected 2026 losses of $18 billion to $19 billion. Zuckerberg said the company is pacing virtual-reality investment more selectively and prioritizing personal-superintelligence initiatives.
Fourth-quarter 2026 revenue is expected to be between $73 billion and $76 billion.
Full-year 2026 expenses are expected to total $175 billion to $179 billion, including the legal charge.
Full-year 2026 capital expenditures are forecast at $135 billion to $145 billion.
Meta expects foreign exchange to represent an approximately 1% headwind to fourth-quarter year-over-year revenue growth.
The company ended the quarter with $82.4 billion in cash and marketable securities and $83.7 billion in debt. Meta also announced plans to create a new class of non-voting capital stock that will be distributed as a stock dividend, giving shareholders one non-voting share for each existing share held. The move effectively represents a two-for-one stock split, with trading expected to begin in late January 2027.
About Meta Platforms (NASDAQ:META)Meta Platforms, Inc is a technology company that develops social networking, messaging, virtual and augmented reality, and artificial intelligence products. The company's principal platforms include Facebook, Instagram, Messenger, WhatsApp, and Threads, which enable users to connect, communicate, share content, and discover products and services.
Meta also operates Reality Labs, its division focused on virtual, augmented, and mixed reality technologies. Reality Labs develops products such as Meta Quest virtual reality headsets and related software and experiences, along with research and hardware intended to support immersive computing.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].
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A judge in New Mexico has ordered Meta to pay $25 billion in civil penalties for deceiving users about privacy on Facebook.
The ruling Wednesday by state District Court Judge Francis J. Mathew came in the state’s landmark Cambridge Analytica case against Facebook for violations of New Mexico’s Unfair Practices Act. It is the largest penalty against the tech giant to date.
The judge’s order followed a civil case in September in which jurors found Meta liable for over 43 million violations of New Mexico consumer protection laws. The company was accused of lying to Facebook users in New Mexico about who had access to their data. The case was brought after political consulting firm Cambridge Analytica used Facebook data to generate targeted political ads during the 2016 election season.
“Facebook promised users that they (the users) controlled their data. This was false,” Mathew wrote in his ruling as reported by The Associated Press.
“Facebook’s wrongdoing — over the course of years and systematically broadcast to the public — goes to the heart of Facebook’s core business practices,” Mathew wrote.
“This judgment should be a signal, an unambiguous message, to Silicon Valley,” state Attorney General Raúl Torrez said at a news conference following Mathew’s ruling.
Meta’s chief legal officer C.J. Mahoney said in a statement to media outlets, “This ruling, and the Attorney General’s approach to this enforcement, makes it all but impossible to do business in the state of New Mexico. At its core, this lawsuit seeks to impose a tax on speech to enforce new rules for what people can say online. We are confident we will win on appeal.”
The U.S. Federal Trade Commission previously levied a $5 billion penalty against Meta in 2019 over the Cambridge Analytica scandal.
The speed of Meta Platforms' (META) earnings growth and profitability path of its Muse AI will be the biggest topics Gil Luria of D.A. Davidson will watch the closest.
The tail of the Cambridge Analytica data scandal is long — and it keeps costing Meta gargantuan sums of money.
On Wednesday, a judge ordered the social media giant to initiate its biggest payout yet: $25 billion to the state of New Mexico for the tech giant’s role in deceiving resident users over its data privacy practices, The New York Times reports.
The huge sum follows a two-week trial in which a New Mexico jury deliberated over the company’s alleged wrongdoing. The jury found that the company behind Facebook and Instagram had committed 43 million violations of the state’s consumer protection laws, each of which carried a $5,000 penalty, the outlet notes.
Part of the case revolved around the company’s handling of a third-party app linked to the Cambridge Analytica data breach, The Wall Street Journal reports. Other parts involved its data privacy policies and its efforts to mitigate misinformation on its platform.
Cambridge Analytica was an outgrowth of a British defense contractor, SLC Group, that specialized in influence operations and other political work. The company notably worked with the Trump campaign during the 2016 presidential election. It was also involved in a number of controversial initiatives.
“We may have paid for the construction of schools for the next 100 years,” New Mexico Attorney General Raúl Torrez told journalists at a press conference, commenting on the case’s resolution.
Meta has said that it will appeal the decision.
“This ruling, and the Attorney General’s approach to this enforcement, makes it all but impossible to do business in the state of New Mexico,” said C.J. Mahoney, Meta’s Chief Legal Officer, in a statement shared with TechCrunch via email. “At its core, this lawsuit seeks to impose a tax on speech to enforce new rules for what people can say online. We are confident we will prevail on appeal. In the meantime, Meta will continue to build a safe and free platform to connect millions of Americans, grow small businesses, and help the country maintain its competitive edge,” he added.
Announces Establishment of New Class C Common Stock
, /PRNewswire/ -- Meta Platforms, Inc. (Nasdaq: META) today reported financial results for the quarter ended September 30, 2026.
"We hit major milestones this quarter toward delivering personal superintelligence for everyone - including launching Muse and Muse Wonder, our first frontier model," said Mark Zuckerberg, Meta founder and CEO. "Our investments are paying off, the core business is strong, and we're seeing velocity across the board."
Third Quarter 2026 Financial Highlights
Three Months Ended September 30,
% Change
In millions, except percentages and per share amounts
2026
2025
Revenue
$ 64,601
$ 51,242
26 %
Costs and expenses
51,613
30,707
68 %
Income from operations
$ 12,988
$ 20,535
(37) %
Operating margin
20 %
40 %
Provision for income taxes
$ 3,141
$ 18,954
(83) %
Effective tax rate
24 %
87 %
Net income
$ 9,860
$ 2,709
264 %
Diluted earnings per share (EPS)
$ 3.83
$ 1.05
265 %
Agreement with U.S. State Attorneys General
In August 2026, we announced an agreement with 52 attorneys general to resolve litigation related to teen mental health and social media, which provides for payments of up to approximately $18.59 billion. Third quarter 2026 costs and expenses includes a $9.89 billion charge related to this agreement. Excluding this charge, the third quarter 2026:
Income from operations of $12.99 billion would have increased by $9.89 billion to $22.88 billion.
Diluted EPS of $3.83 would have increased by $3.57 to $7.40.
Effective tax rate of 24% would have decreased by 7 percentage points to 17%.
Third Quarter 2026 Operational and Other Financial Highlights
Family daily active people (DAP) – DAP was 3.64 billion on average for September 2026, an increase of 3% year-over-year.
Ad impressions – Ad impressions delivered across our Family of Apps increased by 10% year-over-year.
Average price per ad – Average price per ad increased by 14% year-over-year.
Revenue – Revenue was $64.60 billion, an increase of 26% year-over-year on both a reported and constant currency basis.
Costs and expenses – Total costs and expenses were $51.61 billion, an increase of 68% year-over-year. This includes the litigation charge as discussed above.
Capital expenditures – Capital expenditures, including principal payments on finance leases, were $34.91 billion.
Capital return program – Dividend and dividend equivalent payments were $1.36 billion.
Cash, cash equivalents, and marketable securities – Cash, cash equivalents, and marketable securities were $82.45 billion as of September 30, 2026.
Cash flow – Cash flow from operating activities was $32.79 billion, and free cash flow was negative $2.12 billion.(1)
Headcount – Headcount was 66,775 as of September 30, 2026, a decrease of 15% year-over-year.
____________________________________
(1)
For more information on our free cash flow non-GAAP financial measure, see the sections entitled "Non-GAAP Financial Measures" and "Reconciliation of GAAP to Non-GAAP Results" in this press release.
CFO Outlook Commentary
We expect fourth quarter 2026 total revenue to be in the range of $73-76 billion. Our guidance assumes foreign currency is an approximately 1% headwind to year-over-year total revenue growth, based on current exchange rates.
We are raising our expense outlook to incorporate the $9.9 billion charge related to legal proceedings recognized in the third quarter. We now expect full year 2026 total expenses to be in the range of $175-179 billion.
Excluding the third quarter legal charge, we continue to expect 2026 operating income to be above 2025 operating income.
At a segment level, we now expect Reality Labs losses to decline compared to 2025 to a range of $18-19 billion.
We anticipate 2026 capital expenditures, including principal payments on finance leases, to be in the range of $135-145 billion, narrowed from our prior outlook of $130-145 billion.
Absent any changes to our tax landscape, we expect our fourth quarter 2026 tax rate to be between 15-17%.
Additionally, we continue to monitor active legal and regulatory matters that could significantly impact our business and financial results. For example, we continue to see scrutiny on youth-related issues in several markets and have a number of youth-related trials scheduled in the coming months in the U.S.
Looking beyond 2026, we are still developing our budget and capacity plans for next year, but we expect to continue investing aggressively to support both our core business and emerging AI initiatives. Our current capacity and what is scheduled to come online gives us the flexibility to allocate resources across model training, core business growth, and the development and support of new products.
Our AI investments are already delivering substantial incremental advertising revenue through stronger engagement, better recommendations, and more efficient monetization. Building on this progress, our MSL investments are creating the technology and infrastructure needed to unlock significant new revenue opportunities and strengthen capabilities across the business. While these investments will take longer to generate returns than those in our core business, the breadth of monetization opportunities and internal efficiencies gives us confidence in their long-term potential.
Looking ahead, although we are not providing a full-year 2027 revenue outlook, the benefits our AI investments are delivering to the core business, combined with emerging opportunities from model advances and product launches, position us to sustain strong overall revenue growth throughout 2027.
Separately, we remain focused on improving Reality Labs profitability and expect losses to narrow next year to around $15 billion as we reallocate investment toward other priority areas, primarily AI.
Establishment of New Class C Common Stock
The Board of Directors has approved the establishment of a new class of publicly listed, non-voting Class C common stock, with an effective date in January 2027.
The approval by Meta's Board follows the unanimous recommendation of a Special Committee of disinterested and independent directors, which was established by the Board to evaluate the company's capital structure. The Special Committee and the Board determined that creating this new class of stock is advisable, fair, and in the best interests of Meta and its shareholders for a number of reasons, including:
Creating a New Class of Shares for Capital Raising, Employee Compensation, Potential Acquisitions, and Other General Corporate Purposes – The scale of investment required to compete, sustain growth, expand infrastructure, and pursue new strategic initiatives amidst the AI transformation taking place in the industry is significant. The Special Committee determined this new class of common stock will provide Meta the ability to finance its growth and help the company remain a leader among fierce competition both domestic and international.
Continuing to Maximize Long-Term Value for All Shareholders – Since Meta's formation, its management team has prioritized long-term goals and value creation, and its stock price has increased by more than 1,700% since its IPO. By contrast, over the same period, the S&P 500 has increased approximately 495%. The Special Committee wants Meta to continue innovating with an emphasis on long-term growth, which the creation of the Class C stock is intended to help facilitate.
Ensuring Founder and CEO Mark Zuckerberg Continues to Lead Meta into the Next Era – The Special Committee concluded that Mr. Zuckerberg is best suited to lead Meta into its next era and beyond. They recognized that Meta's track record of significant value creation for its shareholders is in large part due to his strong leadership, unique and creative vision, and exceptional management abilities. The creation of the Class C common stock will continue the founder-led model that has driven the company's success since its inception.
Meta intends to file an amended and restated certificate of incorporation in Delaware to establish the Class C common stock, with an effective date of January 19, 2027. The Board has also declared a one-time stock dividend of one share of Class C common stock for each outstanding share of Class A common stock and Class B common stock, contingent upon, and to be paid after, the effectiveness of the amended and restated certificate of incorporation.
The record date and payment date of the stock dividend will be determined by the Board at a later date. After the payment date of the stock dividend, we expect the market price for our Class A common stock to reflect the effect of a two-for-one stock split. The stock dividend will not change the voting power of any shareholder.
The amended and restated certificate of incorporation has been approved by shareholder written consent. We have also entered into a Founder Alignment Agreement with Mr. Zuckerberg, which has terms related to his sales of Class C common stock received in the stock dividend, his service at the company, and conditions for potential future stock dividends of Class C common stock.
Meta's Class A common stock will continue to trade on Nasdaq, and we intend to qualify the Class C common stock for listing on Nasdaq upon its issuance as a result of the stock dividend. More information will be available in our Report on Form 8-K and information statement to be filed with the Securities and Exchange Commission.
Moelis & Company LLC served as independent financial advisor to the Special Committee and Morgan Stanley & Co. LLC served as financial advisor to Meta.
Webcast and Conference Call Information
Meta will host a conference call to discuss its results at 1:30 p.m. PT / 4:30 p.m. ET today. The live webcast of the call can be accessed at the Meta Investor Relations website at investor.atmeta.com, along with the company's earnings press release, financial tables, and slide presentation.
Following the call, a replay will be available at the same website. Transcripts of conference calls with publishing equity research analysts held today will also be posted to the investor.atmeta.com website.
Disclosure Information
Meta uses the investor.atmeta.com and meta.com/news websites as well as Mark Zuckerberg's Facebook profile (facebook.com/zuck), Instagram account (instagram.com/zuck) and Threads profile (threads.net/zuck) as means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD.
About Meta
Meta is building the future of human connection, powered by artificial intelligence and immersive technologies. When Facebook launched in 2004, it changed the way people connect. Apps like Messenger, Instagram, and WhatsApp further empowered billions around the world. Now, Meta is moving toward building experiences that foster deeper connections and unlock new possibilities.
Contacts
Investors:
Rob Bevegni
[email protected] / investor.atmeta.com
Press:
Matt Tye
[email protected] / meta.com/news
Forward-Looking Statements
This press release contains forward-looking statements regarding our future business plans and expectations. These forward-looking statements are only predictions and may differ materially from actual results due to a variety of factors including: the impact of macroeconomic conditions on our business and financial results, including as a result of geopolitical events; our ability to retain or increase users and engagement levels; our reliance on advertising revenue; our dependency on data signals and mobile operating systems, networks, and standards that we do not control; changes to the content or application of third-party policies that impact our advertising practices; risks associated with new products and changes to existing products as well as other new business initiatives, including our artificial intelligence initiatives and Reality Labs efforts; our emphasis on community growth and engagement and the user experience over short-term financial results; maintaining and enhancing our brand and reputation; our ongoing privacy, safety, security, and content and advertising review and enforcement efforts; competition; risks associated with government actions that could restrict access to our products or impair our ability to sell advertising in certain countries; litigation and government inquiries; privacy, legislative, and regulatory concerns or developments; risks associated with acquisitions; security breaches; our ability to manage our scale and geographically-dispersed operations; and market conditions or other factors affecting capital return to stockholders. These and other potential risks and uncertainties that could cause actual results to differ from the results predicted are more fully detailed under the caption "Risk Factors" in our Quarterly Report on Form 10-Q filed with the SEC on July 30, 2026, which is available on our Investor Relations website at investor.atmeta.com and on the SEC website at www.sec.gov. Additional information will also be set forth in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2026. In addition, please note that the date of this press release is October 21, 2026, and any forward-looking statements contained herein are based on assumptions that we believe to be reasonable as of this date. We undertake no obligation to update these statements as a result of new information or future events.
For a discussion of limitations in the measurement of certain of our community metrics, see the section entitled "Limitations of Key Metrics and Other Data" in our most recent quarterly or annual report filed with the SEC.
Non-GAAP Financial Measures
To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States (GAAP), we use the following non-GAAP financial measures: revenue excluding foreign exchange effect, advertising revenue excluding foreign exchange effect, and free cash flow. The presentation of these financial measures is not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. Investors are cautioned that there are material limitations associated with the use of non-GAAP financial measures as an analytical tool. In addition, these measures may be different from non-GAAP financial measures used by other companies, limiting their usefulness for comparison purposes. We compensate for these limitations by providing specific information regarding the GAAP amounts excluded from these non-GAAP financial measures.
We believe these non-GAAP financial measures provide investors with useful supplemental information about the financial performance of our business, enable comparison of financial results between periods where certain items may vary independent of business performance, and allow for greater transparency with respect to key metrics used by management in operating our business.
Our non-GAAP financial measures are adjusted for the following items:
Foreign exchange effect on revenue. To calculate revenue on a constant currency basis, we translate current period revenue using the prior year's monthly exchange rates for our settlement or billing currencies other than the U.S. dollar, which we believe is a useful metric that facilitates comparison to our historical performance.
Purchases of property and equipment; Principal payments on finance leases. We subtract both purchases of property and equipment, and principal payments on finance leases in our calculation of free cash flow because we believe that these two items collectively represent the amount of property and equipment we need to procure to support our business, regardless of whether we procure such property or equipment with a finance lease. We believe that this methodology can provide useful supplemental information to help investors better understand underlying trends in our business. Free cash flow is not intended to represent our residual cash flow available for discretionary expenditures.
For more information on our non-GAAP financial measures and a reconciliation of GAAP to non-GAAP measures, see the "Reconciliation of GAAP to Non-GAAP Results" table in this press release.
META PLATFORMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per share amounts)
(Unaudited)
Three Months Ended September 30,
Nine Months Ended September 30,
2026
2025
2026
2025
Revenue
$ 64,601
$ 51,242
$ 181,712
$ 141,073
Costs and expenses:
Cost of revenue
13,369
9,206
34,917
25,269
Research and development
20,054
15,144
59,409
40,237
Marketing and sales
3,333
2,845
9,672
8,581
General and administrative (1)
14,857
3,512
23,079
8,455
Total costs and expenses
51,613
30,707
127,077
82,542
Income from operations
12,988
20,535
54,635
58,531
Interest and other income (expense), net
13
1,128
(1,126)
2,047
Income before income taxes
13,001
21,663
53,509
60,578
Provision for income taxes
3,141
18,954
1,028
22,888
Net income
$ 9,860
$ 2,709
$ 52,481
$ 37,690
Earnings per share:
Basic
$ 3.86
$ 1.08
$ 20.64
$ 14.96
Diluted
$ 3.83
$ 1.05
$ 20.44
$ 14.62
Weighted-average shares used to compute earnings per share:
Basic
2,552
2,517
2,543
2,520
Diluted
2,573
2,572
2,568
2,578
____________________________________
(1)
The third quarter 2026 general and administrative expenses include a $9.89 billion charge related to the August 2026 agreement with U.S. State Attorneys General to resolve litigation related to teen mental health and social media.
META PLATFORMS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions)
(Unaudited)
September 30, 2026
December 31, 2025
Assets
Current assets:
Cash and cash equivalents
$ 11,222
$ 35,873
Marketable securities
71,227
45,719
Accounts receivable, net
22,716
19,769
Prepaid expenses and other current assets
14,735
7,361
Total current assets
119,900
108,722
Non-marketable equity investments
32,624
27,524
Property and equipment, net
253,222
176,400
Operating lease right-of-use assets
26,576
20,404
Goodwill
23,421
24,534
Other assets
23,093
8,437
Total assets
$ 478,836
$ 366,021
Liabilities and stockholders' equity
Current liabilities:
Accounts payable
$ 19,097
$ 8,894
Operating lease liabilities, current
2,522
2,213
Accrued expenses and other current liabilities
41,392
30,729
Total current liabilities
63,011
41,836
Operating lease liabilities, non-current
28,651
22,940
Long-term debt
80,922
58,744
Long-term income taxes
20,521
21,005
Other liabilities
13,345
4,253
Total liabilities
206,450
148,778
Commitments and contingencies
Stockholders' equity:
Common stock and additional paid-in capital
108,244
95,793
Accumulated other comprehensive income (loss)
(1,200)
271
Retained earnings
165,342
121,179
Total stockholders' equity
272,386
217,243
Total liabilities and stockholders' equity
$ 478,836
$ 366,021
META PLATFORMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2026
2025
2026
2025
Cash flows from operating activities
Net income
$ 9,860
$ 2,709
$ 52,481
$ 37,690
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
7,154
4,963
19,509
13,205
Share-based compensation
7,363
5,555
21,053
14,537
Deferred income taxes
2,117
19,868
3,685
17,704
Unrealized (gain) and loss on equity investments
18
(962)
1,204
(642)
Other
(329)
17
(402)
(359)
Changes in assets and liabilities:
Accounts receivable
(999)
(807)
(3,272)
660
Prepaid expenses and other current assets
(936)
(1,033)
(4,166)
(348)
Other assets
(2,437)
33
(4,973)
(209)
Accounts payable
1,596
(63)
1,242
(637)
Accrued expenses and other current liabilities
1,940
455
7,602
(2,883)
Other liabilities
7,439
(736)
2,910
868
Net cash provided by operating activities
32,786
29,999
96,873
79,586
Cash flows from investing activities
Purchases of property and equipment
(33,942)
(18,829)
(83,055)
(48,308)
Purchases of marketable securities
(41,875)
(2,840)
(117,467)
(22,349)
Sales and maturities of marketable securities
44,802
4,704
88,837
23,761
Payments for non-marketable equity investments
(874)
(3,046)
(2,544)
(18,260)
Payments for held-for-sale assets
(938)
(1,022)
(1,612)
(1,797)
Proceeds from data center venture distribution
1,037
—
1,037
—
Acquisitions of businesses and intangible assets
(111)
(753)
(584)
(815)
Other investing activities
923
(62)
1,079
(48)
Net cash used in investing activities
(30,978)
(21,848)
(114,309)
(67,816)
Cash flows from financing activities
Taxes paid related to net share settlement of equity awards
(4,064)
(5,135)
(12,768)
(14,128)
Repurchases of Class A common stock
—
(3,327)
—
(26,248)
Payments for dividends and dividend equivalents
(1,361)
(1,330)
(4,060)
(3,986)
Proceeds from issuance of long-term debt, net
—
—
24,910
—
Principal payments on finance leases
(964)
(545)
(2,769)
(1,770)
Other financing activities
(344)
290
(2,631)
613
Net cash provided by (used in) financing activities
(6,733)
(10,047)
2,682
(45,519)
Effect of exchange rate changes on cash, cash equivalents, restricted cash, and
restricted cash equivalents
8
9
8
252
Net decrease in cash, cash equivalents, restricted cash, and restricted cash
equivalents
(4,917)
(1,887)
(14,746)
(33,497)
Cash, cash equivalents, restricted cash, and restricted cash equivalents at
beginning of the period
29,271
13,828
39,100
45,438
Cash, cash equivalents, restricted cash, and restricted cash equivalents
at end of the period
$ 24,354
$ 11,941
$ 24,354
$ 11,941
Reconciliation of cash, cash equivalents, restricted cash, and restricted
cash equivalents to the condensed consolidated balance sheets
Cash and cash equivalents
$ 11,222
$ 10,187
$ 11,222
$ 10,187
Restricted cash and restricted cash equivalents, included in prepaid expenses
and other current assets
597
142
597
142
Restricted cash and restricted cash equivalents, included in other assets
12,535
1,612
12,535
1,612
Total cash, cash equivalents, restricted cash, and restricted cash equivalents
$ 24,354
$ 11,941
$ 24,354
$ 11,941
Supplemental cash flow data
Cash paid for income taxes, net
$ 927
$ 749
$ 2,926
$ 6,293
Segment Results
We report our financial results for our two reportable segments: Family of Apps (FoA) and Reality Labs (RL). FoA includes Facebook, Instagram, Messenger, WhatsApp, and other services. RL includes our virtual and augmented reality related consumer hardware, software, and content.
The following table sets forth our segment information of revenue and income (loss) from operations:
Segment Information
(In millions)
(Unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2026
2025
2026
2025
Revenue:
Advertising
$ 63,061
$ 50,082
$ 177,449
$ 138,037
Other revenue
1,097
690
2,987
1,784
Family of Apps
64,158
50,772
180,436
139,821
Reality Labs
443
470
1,276
1,252
Total revenue
$ 64,601
$ 51,242
$ 181,712
$ 141,073
Income (loss) from operations:
Family of Apps
$ 17,117
$ 24,967
$ 67,410
$ 71,702
Reality Labs
(4,129)
(4,432)
(12,775)
(13,171)
Total income from operations
$ 12,988
$ 20,535
$ 54,635
$ 58,531
Reconciliation of GAAP to Non-GAAP Results
(In millions, except percentages)
(Unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2026
2025
2026
2025
GAAP revenue
$ 64,601
$ 51,242
$ 181,712
$ 141,073
Foreign exchange effect on 2026 revenue using 2025 rates
Meta (META.O) on Wednesday raised the lower end of its annual spending forecast and said it would introduce new non-voting shares, in a move that would help fund its costly AI expansion.
Meta has been pouring money into chips and data centers to compete more aggressively with OpenAI and Anthropic, eroding its historically strong free cash flow.
The new shares may allow the company to finance acquisitions and attract top talent without diluting CEO Mark Zuckerberg's voting control amid Silicon Valley's intensifying AI race.
The Facebook and Instagram parent said it now expects capital expenditure to be between $135 billion and $145 billion this year, up from $130 billion to $145 billion expected previously.
The company also reported better-than-expected quarterly revenue of $64.60 billion, ahead of Wall Street estimates of $63.37 billion, according to data compiled by LSEG. It also forecast fourth-quarter revenue above estimates.
The early popularity of its consumer-focused AI agent Muse and the release of a competitive new series of AI models have helped Meta justify those investments to investors, even though some enterprises are restricting the agent's access over security concerns.
Legal challenges are also mounting, including a $25 billion penalty ordered by a judge in New Mexico earlier on Wednesday after a jury found Meta misled the state's residents about how it shared user data with third parties and enforced policies on hate speech and misinformation in a case related to British political consulting firm Cambridge Analytica.
In August, Meta agreed to pay as much as $18 billion over a decade and restrict teenagers' use of Facebook and Instagram to settle claims by nearly all US states alleging that Meta's platforms were designed to addict children.
The agreement removed a significant regulatory hurdle that had weighed on Meta's stock and allowed the company to avoid a potentially lengthy trial that could have exposed more internal documents about its treatment of young users.
Almost all of Meta's revenue comes from advertising, with Reels competing with TikTok and YouTube Shorts for dominance in the short-video market and Threads taking on Elon Musk's X, while its AI sharpens ad targeting and recommendations to boost user engagement.
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Meta, led by Mark Zuckerberg, has spent big on infrastructure for its AI development. Bloomberg/Getty Images Meta is making it rain for AI.
The company spent $34.91 billion in capital expenditures during the third quarter of 2026. That's up from the second quarter's sum, $31.08 billion.
For the year 2026, Meta said it expects to spend between $135-145 billion in capital expenditures, narrowed from its prediction of $130-145 billion last quarter.
Meta's forecast includes the yearly capex prediction that analysts expected: $139.79 billion.
As Meta bets big on AI, it is investing heavily in its development. It has built massive, costly data centers and spent big on computing power.
The spending uptick was expected. On the "Cheeky Pint" podcast earlier this month, CEO Mark Zuckerberg recounted early conversations about the investment — and said he'd bet up to $200 billion on AI, before he knew the models would work.
Investors haven't loved Meta's massive capex forecasts in past quarters. The stock tumbled almost 10% last quarter after earnings per share missed Wall Street estimates, and sank 6% the quarter before on raised capex guidance.
This quarter, Meta has a new hero product: Muse.
The AI assistant has reached over 2 million daily users and 3 million downloads. It quickly scaled the App Store. Muse users told Business Insider they chatted with it to help plan trips and ace exams.
The energy around the company is ebullient, as Alexandr Wang, Meta's chief AI officer, continues to post memes of Muse's squishy-looking mascot.
At Meta's Connect keynote event in September, Zuckerberg said Muse "has a novel business model."
"We believe that Muse will make you money, and we're standing behind this by making Muse free for a huge number of tokens with the expectation that over time, we will profit by taking a small fee from transactions," he said.
Muse could help justify the capex guidance for some investors. The stock was trading up 4.12% after-hours at the time of publication.
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Henry Chandonnet is a senior reporter on the Business News desk. He writes about tech culture, from Silicon Valley's startup class to the everyday AI user. He also closely covers Big Tech and the workplace. Henry previously wrote for Fast Company, where he covered trending tech news. He's written for The Daily Beast, People Magazine, and Vulture.Email Henry at [email protected], reach him on Signal at henrychand.30, or follow him on X @HenryChandonnet.
Meta Platforms Inc (NASDAQ:META, XETRA:FB2A, SIX:FB) delivered another quarter of strong advertising growth, but a $9.9 billion legal charge sent earnings tumbling below analyst expectations even as revenue topped forecasts.
The quarter included a $9.9 billion charge related to an August agreement with 52 state attorneys general to resolve litigation over teen mental health and social media, under which Meta will make payments of up to about $18.59 billion.
Excluding the charge, operating income would have been $22.88 billion and earnings per share $7.40.
The company reported third-quarter revenue of $64.6 billion, up 26% from a year earlier and ahead of analyst estimates of $63.33 billion, as advertising demand remained strong.
Advertising revenue climbed 26% to $63.06 billion on 10% more ad impressions and 14% higher prices per ad, lifting Family of Apps revenue to $64.16 billion, while Reality Labs contributed $443 million.
Daily active people across the company’s apps reached 3.64 billion, up 3% from a year earlier.
Operating income was $12.99 billion, compared with analyst estimates of $18.66 billion, for an operating margin of 20% versus 40% a year earlier. Net income was $9.86 billion, below estimates of $15.44 billion.
Earnings per share were $3.83, against estimates of $5.89. The quarter included $9.9 billion in charges related to an agreement with U.S. state attorneys general.
Family of Apps generated operating income of $17.12 billion, while Reality Labs posted an operating loss of $4.13 billion.
“We hit major milestones this quarter toward delivering personal superintelligence for everyone, including launching Muse and Muse Wonder, our first frontier model,” Meta’s CEO Mark Zuckerberg said.
“Our investments are paying off, the core business is strong, and we’re seeing velocity across the board.”
For the fourth quarter, Meta expects revenue of $73 billion to $76 billion, compared with analyst estimates of $73.68 billion. The company expects a tax rate of 15% to 17%.
Meta narrowed its 2026 capital expenditure outlook to $135 billion to $145 billion, from $130 billion to $145 billion previously. Analysts had expected $132.08 billion. Third-quarter capital expenditure was $34.91 billion, below estimates of $39.72 billion. Total 2026 expenses are expected to be $175 billion to $179 billion, and full-year operating income is expected to exceed 2025 operating income.
Operating cash flow was $32.79 billion in the quarter, and free cash flow was negative $2.12 billion. Meta ended the period with $82.45 billion in cash and marketable securities and $80.92 billion in long-term debt.
Meta also said it has approved a new class of Class C common stock, effective in January 2027. Shareholders will receive a one-time stock dividend of one Class C share for each outstanding Class A and Class B share.
Meta shares rose 3.2% in after-hours trading on Wednesday.
Earlier on Wednesday, a New Mexico state court ordered Meta to pay a $25 billion penalty after jurors found the company made dozens of false statements about how it handled user data and hate speech.
The case related to the company’s handling of hate speech and the Cambridge Analytica scandal. The penalty, imposed by Judge Francis Mathew after a two-week trial, may be the largest single verdict in US legal history.
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Ami Vora, Anthropic's chief product officer, and Daniela Amodei, its president. Don Feria/AP Content Services for Anthropic Anthropic is joining the personal AI agent craze.
The company announced the new app Claude Duet on Wednesday, billed as a "proactive agent" that can run in the background, surface tasks to a user, and handle a variety of work. The tool is in research preview for now with a waitlist, meaning it won't immediately compete for the larger market with other new agents like Meta's Muse and OpenAI's Dots.
Still, the announcement ramps up the pressure on those companies — Anthropic says it built Duet around its flagship Opus 5.5 model, which was released in late September and has already become one of the industry's most popular. Recent model breakthroughs have made AI better at handling work on its own, spurring a rush to build these "always-on" personal agents.
"It can have the discernment and judgment around when to be proactive, when to act on your behalf," said Mike Krieger, a co-lead of Anthropic's Labs team, said in a Duet launch video.
The tool, Anthropic says, will send users a brief each morning about what's happening on their connected apps, and message them when something needs attention. Like other companies' offerings, it runs outside a user's computer, sends notifications, and asks for approval on certain tasks.
Anthropic announced Duet on the day of Meta's earnings report and used the opportunity to mention a new poach from Mark Zuckerberg's company. Karan Ahuja led product management for Meta Superintelligence Labs until July, according to his LinkedIn, before starting at Anthropic in August and leading Duet's development.
He wrote on X that he's been using Duet to build Duet, and said the team "built it for professionals and small business owners juggling a lot at work and at home."
Ahuja also wrote that Anthropic is letting people into Duet from the waitlist "as quickly as possible."
The news didn't go unnoticed at Meta. Alexandr Wang, who heads Meta Superintelligence Labs, posted a meme about Duet's similarity to Muse.
Anthropic is fast approaching a giant initial public offering, which could value the company at as much as $2 trillion. Like other AI players, the company navigates a high-wire competition to win over users, secure computing power, build state-of-the-art models, and deliver AI-native products.
The data firm Apptopia estimates that Muse had more than 14 million installations as of Wednesday. It found that Claude users who installed the Muse app were using Claude more than before, though still for fewer minutes per day than they spent on the Meta product.
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Stephen is a senior tech reporter at Business Insider, covering OpenAI, Anthropic and the ecosystem around the leading artificial intelligence companies.Previously he covered technology at SFGATE, and has written for The Wall Street Journal, The Information and CNBC. He studied journalism and economics at Northwestern University.His work has earned an SF Press Club Investigative Reporting Award and, in 2025, SPJ NorCal’s Excellence in Journalism Award for Technology Reporting.Stephen lives in San Francisco. Contact him via email at [email protected], or on Signal, Telegram, or WhatsApp at 415-757-8198. Use a personal email address, a nonwork WiFi network, and a nonwork device; here's our guide to sharing information securely.
Meta‘s third-quarter revenue beat Wall Street expectations, but earnings took a hit from the company’s settlement of a lawsuit filed on behalf of teenage social media users.
Revenue for the July-to-September period set a new record at $64 billion, beating the consensus forecast of analysts of $63.3 billion. Earnings per share of $3.83 also beat estimates, but without the legal expenses they would have surged to $7.40.
The settlement in the case, reached last August, provides for payments to the plaintiffs and others of up to about $18.59 billion. For the quarter, the company said its report of costs and expenses includes a $9.89 billion charge related to the agreement.
In addition to the financial payment, Facebook and Instagram parent Meta agreed to put in place remedies designed to help protect teens from alleged mental health harms associated with social media use. The measures include the banning and blocking certain features for users younger than 16.
The case was brought by California Attorney General Rob Bonta and coalition of 51 attorneys general.
CFO Susan Li said in the earnings release that the recently resolved suit may not be a one-off, saying the company is closely monitoring regulatory and legal developments. “For example, we continue to see scrutiny on youth-related issues in several markets and have a number of youth-related trials scheduled in the coming months in the U.S.,” she said.
Along with the financial results, the company said it is effecting a 2-for-1 stock split and creating a new set of Class C shares. The new stock will start trading in January 2027 and will be offered to existing shareholders. Proceeds from the new issue, which will not confer voting power on holders, will help fund the company’s aggressive spending on artificial intelligence. Li also said it could be used for employee compensation.
After long struggling to assert the same dominance it has in social media in the booming field of AI, Meta has finally gained traction with the recent launch of the well-received virtual assistant Muse. It also launched a frontier model, Muse Wonder, designed to help the offering gain more scale.
The introduction of Class C shares will also enable CEO and co-founder Mark Zuckerberg to retain control of Meta.
Ygal Arounian, Wedbush Internet equity research managing director, reacts to Meta Platforms' third-quarter earnings and boosted capital spending outlook. He speaks on "Bloomberg The Close.
Meta Platforms (META) shares are extending gains in after-hours trading on Wednesday after its third-quarter revenue beat expectations, giving investors fresh confidence in its ads business. But the October 21st report, brought more than an earnings update: the titan tightened its massive spending forecast and unveiled nonvoting shares.
A federal judge blasted Mark Zuckerberg’s Meta for using attorney-client privilege to conceal thousands of potentially explosive legal documents related to kids’ social media addiction – stating that she had “never seen a company whose employees are so taken” with exploiting the legal loophole.
The harsh words surfaced during a testy Oct. 9 hearing in California federal court, just a couple of weeks after plaintiffs revealed that Instagram had made swag hats for its employees with the phrase “attorney-client privilege” to celebrate the 2024 launch of Instagram’s Teen Accounts. Critics previously lambasted the hats as an “utterly sick” joke about concealing explosive legal documents.
Instagram made the “attorney-client privilege” hats to celebrate the launch of Instagram Teen Accounts in 2024. In the case in which the hat swag surfaced, a coalition of school districts have accused Meta of fueling a teen mental health crisis.
“I have never seen a company whose employees are so taken with the attorney-client privilege that they’d have caps made,” Judge Yvonne Gonzalez Rogers said during the hearing, according to a transcript obtained by The Post.
Meta attorney Ashley Simonsen fired back at the judge, asserting that the hats had “nothing to do” with “whether outside counsel properly applied the privilege in this case.”
Simonsen appeared to have interrupted the judge with her comment, prompting an irked Gonzalez Rogers to reply, “You need to stop talking when I start whether you like it or not.”
“A further review is required, period,” the judge added.
In a bizarre twist, Gonzalez Rogers also shot down a request by Meta’s Simonsen to use an AI model to speed up review of the withheld documents – asserting that the court couldn’t trust the model to be reliable without more information.
Judge Yvonne Gonzalez Rogers, district judge of the US District Court for the Northern District of California, attends a panel discussion held by the annual American Bar Association in Washington, DC, in April 2025. AFP via Getty Images “I don’t trust AI, obviously, as much as you do,” the judge said. “The only way that argument would have any legs is if you trained a model on your own, and obviously all of the training would have to be done and disclosed — all of it — and all of the testing.”
Meta and attorneys for the plaintiffs ultimately agreed to jointly abide by the findings of an independent “special master” — retired US Judge Suzanne Segal, who will review the company’s classifications for some 170,000 documents and determine which were properly withheld and which weren’t.
Judge Gonzalez Rodgers approved the process on Wednesday.
In a joint filing on Monday, Meta agreed to go back over an average of 20,000 documents per week that were initially marked as privileged. It was given until Dec. 30 to complete the process.
Meta CEO Mark Zuckerberg appears at an event. Getty Images Additionally, each week the special master will review a random sample of 200 documents that Meta claims should remained privileged or redacted. She’ll then make a decision on whether the classification is accurate – or if the docs should be turned over to the plaintiffs as requested.
Any company records that the special master determines should be unredacted must be turned over within five days. Meta also has to cover the cost of the review.
As The Post reported last month, online safety advocates were outraged over Meta’s decision to make the “attorney-client privilege” hats for employees – with one group, Fairplay, describing it as “utterly sick.”
“There is nothing funny about the damage Meta has done to kids’ lives,” Fairplay Communications Director Ashwin Verghese said at the time. “It’s good these revelations are coming out, though, so parents and policymakers know exactly how this company operates.”
A 3D-printed Meta logo is seen in this illustration, Monday, July 20, 2026. REUTERS Meta’s critics have argued for years that the company should be more transparent about its internal research and documents detailing the risks that apps like Facebook and Instagram pose to kids.
In one past instance, records from California court showed the company’s own researchers compared Instagram to a “drug” and said they were “basically pushers.”
Gonzalez Rogers is overseeing complex federal multidistrict litigation in California federal court – a bid to streamline thousands of cases that make similar claims about social media addiction and online harm into a few “bellwether” cases to determine the legal merits of their arguments.
In May, Meta reached a settlement with Breathitt County School District in Kentucky to avoid a trial that had been slated to begin in Oakland on June 15. However, thousands more are still pending.
Elsewhere, Meta reached a separate $18 billion settlement with a coalition of 48 state attorneys general In August. As part of that settlement, the company agreed to impose changes such as daily usage limits for teens.
Meta did not immediately return a request for comment.
Meta said during its third-quarter earnings call on Wednesday that its AI app Muse has been adopted by more than 10 million users, confirming estimates released earlier this week by market intelligence firm Sensor Tower.
But it is how people are using it, and how much they’re spending that has caught CEO Mark Zuckerberg’s attention. Zuckerberg said about 25% of people who set up Muse now use it daily, helping improve retention.
He also shared that over a quarter of Muse’s engaged users who were shopping via the AI agent, had an average purchase size of over $200, which was surprising even to industry insiders.
“Plaid told us that they hadn’t seen activity like they’re seeing with their connector on any other service before,” Zuckerberg said, referring to the financial technology company that connects payment apps to customers’ bank accounts. Muse uses Plaid’s connector to enable agentic shopping.
Beyond shopping, Zuckerberg said other popular uses for Muse include personal productivity tasks, such as connecting the AI agent to users’ email or calendars. The exec stressed that this indicates users trusted Muse’s security setup, which includes a feature called “Muse Secure VM” designed to protect their data and privacy. He also mentioned that the forthcoming “Muse Confidential VM” will prevent even Meta from seeing users’ content.
Now that Muse has achieved “product-market fit,” Zuckerberg said Meta’s focus will shift to scaling the AI agent, increasing revenue, and optimizing its compute costs. Remarkably, the tech company is forecasting that Muse will eventually bring in more revenue per user than its “family of apps” users do today — meaning its users on Facebook, Instagram, WhatsApp, and Messenger. Currently, that figure is around “several hundreds of dollars annually,” Zuckerberg said.
Meta has said it ultimately intends to monetize Muse by keeping it free for most users, but keeping a percentage of the commerce taking place on the platform. Power users who want access to the most advanced AI models or more tokens will also have to pay.
Zuckerberg also noted that Meta believes Muse will be profitable after it scales.
“On the compute side, we are building out the capacity to serve more than a billion people over the next few years,” he told bankers and analysts on the Q3 earnings call. “In the near term, Muse is very compute-intensive to run, but we expect to improve its cost efficiency by more than 10x in the next year, which will enable it to be profitable once the revenue lines are at scale.”
Muse will also play a central role in Meta’s smart glasses strategy. Reality Labs, the division responsible for smart glasses, VR, and the metaverse, is still losing billions. However, the division’s losses are expected to improve from $19.1 billion in 2025 to $15 billion this year.
Beyond scaling and supporting its hardware strategy, Zuckerberg teased the company’s plans for something he called the “Muse network.” He described this as taking Muse from a “single-player game” to one where “your Muses can work with your friends’ and your families’ [Muses].”
“And if you want to buy something, it’s not just navigating to that business’s website; it’s talking to their agent,” he added.
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Sarah has worked as a reporter for TechCrunch since August 2011. She joined the company after having previously spent over three years at ReadWriteWeb. Prior to her work as a reporter, Sarah worked in I.T. across a number of industries, including banking, retail and software.
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SummaryMeta Platforms, Inc. remains the premier mega-cap technology stock to buy, even after its recent rally and heavy capital deployment into AI.META's Q3 results showcased a 26% YoY revenue surge to $64.6B, robust ad volume, and strong adjusted EPS of $7.40, despite a significant legal charge.Generative AI investments, especially the Muse model suite, are driving accelerating advertiser returns, user engagement, and double-digit ad price growth.Capex intensity and legal liabilities remain key risks, but META's multi-year growth outlook, operational cash flow, and AI monetization justify a buy rating.We have a META free cash flow problem to contend with, however.Looking for more investing ideas like this one? Get them exclusively at BAD BEAT Investing. Learn More » Kenneth Cheung/iStock Unreleased via Getty Images
Today we turn our attention back to Meta Platforms, Inc. (META). After a very choppy year where we defended it in the $500s this year, it remains the premier mega-cap technology stock to buy. Even
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Meta creates a new stock class to keep Zuckerberg in control
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Meta wants to continue its "founder-led model" — so it's creating a new stock class.
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Meta's board wants Mark Zuckerberg to stick around.
The company announced a new category of non-voting Class C stock in its third-quarter earnings report. It listed several reasons for creating the new class — one of which is to keep the CEO in control.
A Special Committee established by Meta's board determined that Zuckerberg was the best fit to lead the company into its future, and highlighted the CEO's creative vision and management abilities.
"The creation of the Class C common stock will continue the founder-led model that has driven the company's success since its inception," Meta said.
The stock class will also provide Meta the ability to finance its growth, the earnings report said. Meta is spending big on AI and the data centers needed to power it. The company reported $34.91 billion in third-quarter capital expenditures.
Meta's press release said the distribution would effectively amount to a two-for-one stock split for existing shareholders. Susan Li, Meta's chief financial officer, said that the stock will be distributed to existing shareholders.
Other tech companies have issued stock to access new capital without diluting their CEO's voting power. Google performed a stock split in 2012 for a similar reason. Semafor was first to report the new stock class.
Zuckerberg has long been the face of Meta. He's strengthened his leadership through the AI boom, going "startup mode" and getting hands-on with the tech. He even moved his desk closer to the AI team.
The success of Muse, Meta's AI agent, has raised the profile of another Meta executive: Alexandr Wang. The chief AI officer has joined Zuckerberg for podcasts and spoken onstage at keynotes.
A Financial Times profile last week touted Wang as a "potential successor to Zuckerberg." It's clear the board wants Zuckerberg there for the long haul.
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Henry Chandonnet is a senior reporter on the Business News desk. He writes about tech culture, from Silicon Valley's startup class to the everyday AI user. He also closely covers Big Tech and the workplace. Henry previously wrote for Fast Company, where he covered trending tech news. He's written for The Daily Beast, People Magazine, and Vulture.Email Henry at [email protected], reach him on Signal at henrychand.30, or follow him on X @HenryChandonnet.
Meta CEO Mark Zuckerberg says Muse and Reality Labs are highly unprofitable — for now
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Meta CEO Mark Zuckerberg.
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Meta says some of its biggest cash incinerators could finally start turning profits.
The social media giant, which generated over 97% of its quarterly revenue from ads, has faced persistent questions from investors about the lack of profitability in its AI and hardware initiatives.
Meta CEO Mark Zuckerberg addressed those concerns head-on during its third-quarter earnings call on Wednesday.
Zuckerberg said that Muse, the AI assistant it launched last month, is unprofitable since it's "very compute intensive to run." Meta expects to start turning that around next year by massively improving Muse's efficiency.
"If compute efficiency continues improving quickly for another few years, which we think is highly likely, then Muse will be highly profitable over multiple years," he said.
Meta plans to make money from Muse by taking a small transaction fee off of purchases it drives, Zuckerberg said at Meta's Connect conference last month.
Zuckerberg added that Muse, which launched only in the US and Canada, wasn't launched globally due in part to the amount of compute it requires. (Meta's North American users are generally its most lucrative.)
Zuckerberg also struck a positive note about its cash-hemorrhaging Reality Labs division, which makes products like Meta Ray-Bans and virtual reality glasses.
Reality Labs will narrow its losses to about $15 billion in 2027, down from the $18 to $19 billion it expects to lose this year. The division should start trending toward profitability next year, as Meta's AI systems make it more useful, Zuckerberg said.
"I continue to believe that the path to delivering holographic experience, of bringing together the physical and digital worlds and everyday glasses, will come through VR first," Zuckerberg said.
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Plus, the Starlink slowdown hurt Ukraine's ability to stop Russian attacks, and U.S. special envoy Steve Witkoff praised Vladimir Putin as a ‘humanitarian.'
Meta Platforms nehodlá v masivních investicích do vývoje umělé inteligence polevit, ba naopak. Vedle zveřejnění hospodářských výsledků za třetí čtvrtletí společnost zvýšila výhled kapitálových výdajů a oznámila novou třídu akcií bez hlasovacích práv, čímž si otevírá cestu k novému kapitálu.
Provozovatel Facebooku či Instagramu vygeneroval ve třetím čtvrtletí tržby ve výši 64,6 miliardy dolarů, což bylo meziročně o 26 procent více a zároveň o 1,3 mld. USD více než odhadoval trh. Upravený zisk na akcii činil 3,83 USD, což naopak bylo hluboko pod odhadem Wall Street (5,89 USD).
Společnost slabší EPS zdůvodnila tím, že do něj nezapočítala jednorázový poplatek 9,89 mld. USD související s dohodou s 52 generálními prokurátory ohledně soudního řízení o duševním zdraví teenagerů. Bez poplatku by provozní příjem činil 22,88 mld. USD, zatímco trh očekával 18,66 mld. USD.
Společnost ve své středeční výsledkové zprávě také uvedla, že kapitálové výdaje v letošním roce dosáhnou 135 až 145 miliard dolarů, což je navýšení spodní hranice předchozího výhledu z 130 miliard dolarů.
Vedle toho Meta oznámila vytvoření nové třídy akcií bez hlasovacích práv, která bude rozdělena stávajícím akcionářům formou akciové dividendy. Investoři obdrží jednu novou akcii za každou drženou akcii, což bude v praxi fungovat jako štěpení akcií (stock split) v poměru 2:1. Obchodování s novou třídou akcií by mělo začít v lednu. Meta uvedla, že nové akcie bude využívat k získávání kapitálu, odměňování zaměstnanců a případným akvizicím.
Tyto kroky naznačují, že společnost věří v návratnost svých masivních investic do AI, píše agentura Bloomberg a připomíná, že generální ředitel Mark Zuckerberg měl v minulých letech potíže přesvědčit investory, aby akceptovali rychle rostoucí náklady spojené s ambiciózními projekty v oblasti umělé inteligence. V posledních měsících však Meta podle všeho dosáhla v této oblasti významného pokroku, a to zejména díky úspěšnému vydání AI agenta Muse.
Součástí výsledkové zprávy byl také výhled na čtvrté čtvrtletí. Společnost očekává tržby v rozmezí 73 až 76 miliard dolarů, zatímco analytici oslovení v průměru počítali s 73,6 mld. USD. Výhled tržeb pro fiskální rok 2027 firma neposkytla.??
Akcie Mety reagovaly na výsledky v aftermarketu růstem přibližně o čtyři procenta.
Jack McRoskey calls Meta Platforms' (META) story one of the most interesting in the stock market. With the company's Muse agent proving itself as an AI success story, he says all eyes will turn to the social media giant's future AI outlook, including whether CapEx increases again.
Meta was ordered to pay $25 billion in penalties by a New Mexico court on Wednesday as part of a data privacy case that stemmed from the company's Cambridge Analytica scandal from nearly a decade ago.
The penalty, revealed in a court filing, comes after a jury in a Santa Fe courthouse found in September the social media giant liable for misleading state citizens about how it safeguards and collects user data and prevents harmful information from flourishing on its services.
Although the jury concluded that Meta had more than 43 million violations of the state's unfair practices act, with each transgression carrying a civil penalty as high as $5,000, a New Mexico judge was responsible for determining the ultimate fine. The Wednesday filing showed that the state was awarded $219.5 billion, but the penalty was ultimately reduced to $25 billion.
"The extraordinary number of willful violations found by the jury, the duration and repetition of the conduct, the breadth of subjects on which violations occurred, the involvement of senior Facebook leadership, the size of New Mexico audiences reached, and the clear intentional and systematic nature of Facebook's repeated misstatements established in the trial record support the highest level of penalty allowed by the New Mexico Unfair Practices Act - $5,000 per violation found by the jury," New Mexico District Court Judge Francis Mathew wrote in the filing.
The judge added that interest on the penalty shall accrue at the rate of 15% each year until the fine is paid off in full.
"For too long, powerful technology companies have operated as though their size and influence put them beyond the reach of the law," said New Mexico Attorney General Raúl Torrez in a statement.
He added that "this penalty order demonstrates that those violations carry real consequences."
Meta chief legal officer C.J. Mahoney criticized the penalty, saying in a statement that the company is "confident" that it will "prevail on appeal."
"This ruling, and the Attorney General's approach to this enforcement, makes it all but impossible to do business in the state of New Mexico," Mahoney said in the statement. "At its core, this lawsuit seeks to impose a tax on speech to enforce new rules for what people can say online."
Meta previously resolved various Cambridge Analytica-derived data privacy lawsuits across the nation as part of an overarching August settlement of nearly $17 billion with a coalition of state attorneys general in a separate federal case related to child safety and mental health. But because New Mexico was not part of the settlement, the state's data privacy case that arose from Meta's Cambridge Analytica scandal proceeded to trial in September.
In 2022, the social media giant agreed to pay $725 million to settle a class action lawsuit that also sprang from the company's Cambridge Analytica scandal that kicked off in 2018. That scandal rocked the Mark Zuckerberg-led company before its official name change to Meta, and focused on allegations that the political consulting firm Cambridge Analytica improperly accessed the information of 87 million users, raising questions about Facebook's data handling practices.
Mathew said in the filing that "Facebook did not conduct the comprehensive investigation that it promised" following the Cambridge Analytica revelations.
"Pressure from senior executives to keep costs down, lack of adequate enforcement resources, inadequate investigative techniques, and a desire not to create precedent for future investigations," all contributed to what the judge characterized as a "willfully ineffective" internal examination by Facebook, the filing said.
Former New Mexico Attorney General Hector Balderas originally filed the state's Cambridge Analytica-related lawsuit in 2021, while current AG Torrez oversaw the related trial.
Torrez also led his state's child safety-related trial against Meta that resulted in a March jury ruling that the social media company should pay $375 million for violating the state's unfair practices act. A New Mexico judge would later order Meta to pay $567 million into an abatement fund as part of a second phase of the case that determined the social media firm's actions created a public nuisance.
Meta said it disagreed with that New Mexico ruling and planned to appeal.
A judge in New Mexico ordered Meta Platforms (META.O) to pay $25 billion on Wednesday after a jury found the company had misled consumers in a case arising from allegations that a political consulting firm involved in Donald Trump's 2016 presidential campaign obtained data from millions of Facebook users without their consent.
"Facebook's wrongdoing — over the course of years and systematically broadcast to the public — goes to the heart of Facebook's core business practices," Judge Francis Mathew wrote in his order following the verdict.
Mathew found that a penalty of more than $219 billion was warranted, based on state law, but he reduced the figure to $25 billion.
A spokesperson for Meta did not immediately respond to a request for comment.
The state's attorney general had sued Meta in 2021 following revelations that Cambridge Analytica, a British political consulting firm, had harvested personal data from as many as 87 million Facebook users through a third-party app.
The state accused Meta of lying to Facebook users in New Mexico about who had access to their data, how the company handles hate speech and misinformation posted on the platform and other internal policies. The company knew that third parties had broad access to users' personal data, and it tolerated hate speech or other harmful content when it benefited the company's bottom line, the state said.
RESIDENTS MISLED ABOUT PRIVACY
Jurors on September 25 found that 26 of 29 statements made by the company and its leadership on those issues were misleading. They said the company had committed more than 43 million violations of New Mexico’s consumer protection laws, based on the number of Facebook users or New Mexico residents who were the audience for each misleading statement.
State law allows a penalty of up to $5,000 per violation, and directs that all of the money go to New Mexico's school system, New Mexico Attorney General Raúl Torrez told reporters after the verdict. At a hearing on October 1, Randi McGinn, a lawyer for New Mexico, had asked Mathew to award the state between $35 billion and $40 billion, saying that would be supported by the US Constitution's protections on due process and the jury's verdict.
"This court should speak to Meta in the only language it understands, which is money, and the value of its stock price," McGinn said.
In court filings, Meta urged Mathew to cap the penalties at $3.45 billion, saying a higher penalty ran the risk of scaring businesses out of the state. The evidence showed that Meta does not sell user data and New Mexico did not prove that any consumer had actually been misled, the company said in court filings.
TWO JURIES SIDED WITH STATE
The verdict was the second in six months by a Santa Fe jury in a lawsuit brought by the state of New Mexico against Meta Platforms.
In the first trial, which ended in March, a Santa Fe jury found Meta misled users about young users’ safety on its Facebook, Instagram and WhatsApp platforms and ordered the company to pay $375 million in civil penalties. After a second phase of that trial, a judge directed the company to pay $567 million into a New Mexico fund for teen mental health and ordered Meta to implement measures to protect teen Facebook and Instagram users in New Mexico.
The penalty, one of the largest levied against the tech giant, stemmed from a lawsuit by New Mexico claiming the social media company had misled users about their data privacy.
A judge in New Mexico ordered Meta Platforms to pay $25 billion on Wednesday after a jury found the company had misled consumers in a case arising from allegations that a political consulting firm involved in Donald Trump’s 2016 presidential campaign obtained data from millions of Facebook users without their consent.
The state’s attorney general had sued Meta in 2021 following revelations that Cambridge Analytica, a British political consulting firm, had harvested personal data from as many as 87 million Facebook users through a third-party app.
The state accused Meta of lying to Facebook users in New Mexico about who had access to their data, how the company handles hate speech and misinformation posted on the platform and other internal policies.
Meta Platforms was ordered to pay $25B after a jury found it misled consumers after allegations that a political consulting firm involved in President Trump’s 2016 campaign obtained data from Facebook users without consent. AP Photo/Jacquelyn Martin
Attorney General Raul Torrez had sued Meta in 2021 following revelations that Cambridge Analytica, a British political consulting firm, had harvested personal data from as many as 87 million Facebook users through a third-party app. AP Photo/Susan Montoya Bryan
The company knew that third parties had broad access to users’ personal data, and it tolerated hate speech or other harmful content when it benefited the company’s bottom line, the state said.
Residents misled about privacy
Jurors on Sept. 25 found that 26 of 29 statements made by the company and its leadership on those issues were misleading.
They said the company had committed more than 43 million violations of New Mexico’s consumer protection laws, based on the number of Facebook users or New Mexico residents who were the audience for each misleading statement.
State law allows a penalty of up to $5,000 per violation, and directs that all of the money go to New Mexico’s school system, New Mexico Attorney General Raúl Torrez told reporters after the verdict.
At a hearing on Oct. 1, Randi McGinn, a lawyer for New Mexico, had asked Mathew to award the state between $35 billion and $40 billion, saying that would be supported by the US Constitution’s protections on due process and the jury’s verdict.
“This court should speak to Meta in the only language it understands, which is money, and the value of its stock price,” McGinn said.
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Meta CEO Mark Zuckerberg.
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A judge in New Mexico ordered Meta to pay $25 billion for misleading users about how it handled their data and for failing to prevent misinformation on Facebook.
The ruling could be the largest penalty in Meta's history. Last month, Meta settled a child-safety lawsuit brought by a group of US states for $18 billion.
The New Mexico case focused on Meta's handling of user records that Cambridge Analytica used for campaign purposes during the 2016 election. New Mexico alleged that Facebook misrepresented the extent of users' control over their data on the app.
"Facebook's wrongdoing—over the course of years and systematically broadcast to the public—goes to the heart of Facebook's core business practices," Judge Francis J. Mathew wrote in the ruling. "It relates to the way in which Facebook induces people onto the platform and ultimately keeps them there."
A jury ruled against Meta last month, finding the company committed nearly 50 million violations of a New Mexico law prohibiting deceptive trade practices. Each violation carries a penalty of up to $5,000.
Some Meta executives, including CEO Mark Zuckerberg, were deposed in the case. New Mexico first sued the company in 2021, and the case went to trial last month.
In internal Meta communications presented at the trial, Zuckerberg appeared to obfuscate methods for users to hide their data.
"Give them a chance to change their privacy settings but obviously don't encourage it," Zuckerberg wrote in one internal message.
Meta's next move remains unclear. The company didn't immediately respond to a request for comment on Wednesday.
This is a breaking news story. It will be updated.
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Natalie is a senior reporter on Business Insider's Business News team covering the AI and data center boom.She was previously on BI's Legal Affairs team, where she handled major cases coming out of state and federal court, as well as bankruptcy. Her coverage often focused on stories at the intersection of law, business, politics, and technology. Natalie has covered Donald Trump’s criminal and civil cases, the wave of lawsuits against the second Trump administration, the indictment and criminal trial of Sean “Diddy” Combs, the shooting death of UnitedHealthcare CEO Brian Thompson, and the legal battles facing Elon Musk and his companies. Natalie came to Business Insider in June 2021 as a breaking news reporter, focusing on the most interesting angles on the day's trending news. Natalie largely drove BI’s coverage around the fatal “Rust” shooting involving Alec Baldwin and the disappearance and murder of Gabby Petito.Prior to joining BI, Natalie worked for the New York Post, the New York Daily News, and The Brooklyn Paper. She has an extensive background covering crime and courts. During her more than 12-year journalism career, she did a stint covering the police beat out of the New York Police Department's headquarters. Natalie, a Brooklyn native, graduated from Brooklyn College in 2012 with a degree in journalism.
Charles Rollet
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Charles Rollet is Business Insider's tech correspondent in San Francisco, where he focuses on breaking major news about the AI industry. In 2025, he led an investigation which revealed that Scale AI had inadvertently exposed confidential data about its workers and clients. In 2026, he was the first to break the news that Meta had halted a controversial keystroke tracking program.Prior to joining BI, Charles worked at TechCrunch covering startups and VC in San Francisco. Before that, he was based in Southeast Asia for a decade, where his work won a Gerald Loeb award and was nominated for a Society of Publishers in Asia award. His reporting on the surveillance industry led to US human rights sanctions on five Chinese security camera manufacturers.Charles is especially interested in how frontier AI models are built and trained. He has a master's degree in business reporting from NYU and a bachelor's degree in history from Northwestern.You can contact Charles securely on Signal at charlesrollet.12 or +1-628-282-2811. Charles keeps sources anonymous. Please use a non-work device to reach out.
Characteristics and Risks of Standardized Options: https://bit.ly/2v9tH6D. Expectations are getting high in Meta Platforms (META), says Kevin Hincks, and the key factor he sees driving shares higher will be a clear roadmap for future profits.
Meta Platforms Inc. (NASDAQ:META) heads into third-quarter earnings with investors balancing strong AI-driven advertising momentum and early enthusiasm around Muse against heavy infrastructure spending, enterprise restrictions and questions over when the new AI agent will meaningfully contribute to revenue.
Speculation is growing that Meta will issue new stock to finance a massive buildout of AI infrastructure – even as Wall Street grows increasingly skittish over whether the big bets will pay off, On The Money has learned.
Shares for the holding company for Facebook, YouTube and Instagram have been whipsawed as investors scrambled to digest Mark Zuckerberg’s lavish AI spending. One reason for optimism has been the introduction of Meta’s new AI personal assistant platform, Muse, spearheaded by wunderkind acqui-hire Alexandr Wang.
And as I’ve pointed out, the company hasn’t done a big secondary stock sale and chose to finance its AI expansion through debt issuance, thus keeping the dilution — which lowers the share price — at bay.
Mark Zuckerberg takes the stage at the Meta Connect developer conference in Menlo Park, United States, Wednesday, Sept. 23, 2026. ZUMAPRESS.com But traders known as short sellers – who can make a few bucks betting on a possible dilutive and stock-price depressing event like a secondary — are sensing that one is looming. The sentiment has surely reached the analyst community, so expect a question or two or three on this matter later on Wednesday when Meta announces third-quarter earnings.
A spokesman would neither confirm nor deny any plans for a secondary.
Larry McDonald of the Bear Traps Reports, which is closely watched by the short-selling community, tells me that his sources are starting to bake in a “monster secondary” coming soon. The thinking among the shorts, he says, is that Meta has no choice but to sell stock given the enormity of his AI spending – $145 billion this year alone as it sits on $90 billion in cash.
Zuck may want to time the sale not only with the recent upswing in Meta stock (it’s up more than 6% year to date despite the see-sawing) but also euphoria that is likely to surround the upcoming Anthropic IPO, which we reported is expected to follow the filing of an S-1 prospectus in the coming days. The sale is expected to hit the market sometime around Thanksgiving.
One reason for optimism has been the introduction of Meta’s new AI personal assistant platform, Muse, spearheaded by wunderkind acqui-hire Alexandr Wang. AP Photo/Jeff Chiu But with increased supply comes lower share prices, hence the short-selling bets against Meta. For those precise numbers I turned to my partner in the Risk and Return podcast, Bob Sloan of S3 Data.
Bob’s data shows that so-called “short interest positioning” in Meta is up over 20% or 33 million shares since mid August, which roughly tracks the recent volatility in shares as shorts wager something is coming where they can make money.
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As most readers on On The Money know, diverging opinions – people going long and short on stocks – is the mother’s milk of price discovery. The short thesis on Meta certainly makes sense. Then again, so does the long thesis with Muse coming on line, the company’s increased productivity thanks to AI and recent strategic investments including the popular Ray-Ban glasses.
In the words of someone smarter than me: We report, you decide.
Meta's ad machine is printing money while its AI spending devours cash flow, and the stock keeps hitting the same ceiling. Whether that ceiling breaks depends on what happens inside three specific numbers next quarter.
Meta Platforms (NASDAQ:META | META Price Prediction) trades at $694.25, below the $730 range where the stock keeps stalling. With the next earnings report coming up, investors are again asking whether it is still a buy, and the answer depends on whether AI spending starts paying for itself.
Meta’s apps (Facebook, Instagram, Messenger and WhatsApp) reach 3.60 billion people every day, and advertising brings in nearly all of its revenue. Shares closed at $597.37 on the day Meta reported second-quarter results. They have since climbed back, but they fell 8.95% over the past week from $762.50.
A 27% Ad Growth Engine Trading at 22x Forward Earnings
Ad revenue rose 27% to $59.36 billion. Meta served 14% more ad impressions and charged 12% more per ad. Advantage Plus, Meta’s AI-driven ad product, has passed a $75 billion annual revenue run rate. Strip out legal charges and severance, and operating income would have increased 9%.
The stock still trades at a forward P/E of 22 with a PEG ratio of 0.985. Management also says Meta is short on computing power and has received offers at “a significant premium” over what it paid for that capacity.
Capex Up to $145 Billion Is Draining Free Cash Flow
Meta expects to spend $130 billion to $145 billion on capex in 2026, up from $72.22 billion in 2025 (the power suppliers behind that expansion are the subject of a free report we put together on seven AI infrastructure stocks that aren’t chipmakers). Second-quarter free cash flow dropped to $784 million from $8.55 billion a year earlier. Operating margin fell to 31% from 43%, and long-term debt rose to $83.66 billion.
Diluted EPS of $6.18 missed the $7.22 consensus, which ended a six-quarter run of beats. Management also warned that youth-related U.S. trials could result in material losses.
Q3 Margins Will Decide Whether $730 Breaks
One-time items explain much of the second-quarter weakness: $2.4 billion in legal charges and $1.2 billion in severance. Management still expects 2026 operating income to come in above 2025. What it has left open is 2027 capex, which it did not guide, so cash flow beyond this year is hard to forecast.
Analysts See 18% Upside While Meta Lags the S&P 500
The 63 analysts covering Meta set an average target of $819, meaning about 18% upside. Analyst targets are estimates, and outcomes can differ. The ratings currently break down as follows:
Strong Buy: 8
Buy: 47
Hold: 7
Sell: 1
Meta is up 5.43% year to date, while the S&P 500 is up 12.78%. Over one year, Meta is down 4.87% and the index is up 14.56%. The stock trades at a trailing P/E of 25 and sits well below its 52-week high of $779.82.
Cash Flow Must Show the AI Payoff Before Meta Breaks Out
At $694.25, Meta still has to prove its AI spending pays off.
For the stock to clear $730 and stay there, three things need to happen. Third-quarter revenue has to land toward the top of the $61 billion to $64 billion guidance. Operating margin needs to recover toward the 40% range once the one-time charges drop out. And the first 2027 capex outlook has to show that spending is leveling off.
Earnings beats alone have not been enough. After the Q1 report, EPS came in 56.79% above estimates, yet the stock fell 8.55% that day. Investors are watching cash flow more closely than EPS.
A Buy case would need free cash flow to recover and more evidence that the 1 million businesses using Meta’s AI business agents each week are turning into revenue. A Sell case would need ad pricing to slow or a costly loss in the youth trials. The ad engine is strong enough to limit downside, and spending is heavy enough to cap the upside.
One more quarter of margin and cash flow data will show whether the AI return has started to appear in the numbers.
Contact [email protected] for any questions or corrections.
Meta walks into earnings with its ad engine still accelerating and a capex bill that rattles even the bulls. Our model lands on a price target Wall Street has not caught up to yet, and the confidence level behind it…
Meta Platforms (NASDAQ:META | META Price Prediction) is scheduled to report third-quarter results on October 21 after the close. Shares closed at $709.33. The 24/7 Wall St. price target for Meta is $913.41 over the next 12 months.
Metric
Value
Current Price
$709.33
Price Target from 24/7 Wall St.
$913.41
Upside/Downside
28.77%
Model Rating
BUY
Confidence Level
90%
Our model has high confidence in this call. Meta’s ad engine is still growing at close to 30% a year, and that growth matters more to the model than the margin hit from AI spending. The upside is about twice what Wall Street’s consensus target implies.
Meta Shares Recover After a Second-Quarter EPS Miss
Over the past week Meta slipped 1.3%, including a 3.72% drop on Friday. Shares are up 5.42% over the past month, roughly 6.7% over three months and 7.72% year to date. That leaves the stock about 9% below its 52-week high of $779.82.
Second-quarter revenue rose 27.96% to $60.80 billion, ahead of the $60.29 billion estimate. EPS came in at $6.18, short of the $7.22 consensus. That miss ended a six-quarter run of EPS beats. For the third quarter, management guided revenue to $61 to $64 billion.
Why Bulls See $1,046 Within Reach
Meta’s core ad business is still speeding up. In Q2, ad impressions rose 14% and the average price per ad climbed 12%. Advantage Plus, Meta’s automated ad product, has passed a $75 billion annual revenue run rate. More than 1 million businesses now use Meta’s AI business agents every week.
Zuckerberg told analysts, “The opportunity in front of us is massive.” Of the analysts covering the stock, 55 rate it a buy or strong buy, with their consensus target at $813.65. Our bull case reaches $1,046.27, a gain of 47.5%.
Capex and Courtrooms Could Cap the Upside
Meta plans to spend $130 to $145 billion on capital projects in 2026. Q2 free cash flow fell to $784 million from $8.55 billion, and long-term debt rose to $83.66 billion. That expansion has to be powered, cooled, and networked by someone, and we highlighted seven suppliers riding exactly that wave in a free AI infrastructure report.
Management has also warned that U.S. trials over youth safety could lead to material losses. One offsetting point: $2.40 billion in legal charges and $1.18 billion in severance hit the quarter, and both are one-time costs. Our bear case is $779.62, which is still above today’s price.
Meta Costs More Than Alphabet but Earns Higher Margins
The main rival to Meta for digital ad budgets is Alphabet (NASDAQ:GOOGL). Those earnings trade at 15x, but they include $99 billion in unrealized gains on equity holdings. On free cash flow, Alphabet costs 57x versus 34x for Meta.
Snap (NYSE:SNAP) competes with Meta for younger users and faces similar youth-safety lawsuits. Its revenue grew 18.9%, but its operating margin is negative. Taken together, the peer comparison makes our target look reasonable.
Company
P/FCF
Operating Margin
Meta
34x
41.44%
Alphabet
57x
32.1%
Snap
20x
-9.0%
Meta’s AI Ad Engine Is Strong Enough to Justify Our Target
The 24/7 Wall St. price target is $913.41, with a buy rating at 90% confidence. Ad revenue growth near 30% is what tips the balance, more than offsetting the pressure from capex.
My view gets stronger if Q3 revenue comes in near the top of guidance and costs steady. I would turn more cautious if capex plans for 2027 rise again or the youth-safety trials go badly. On balance, the model sees more upside than risk.
Year
Price Target from 24/7 Wall St.
2026
$913.41
2027
$1,064.13
2028
$1,260.38
2029
$1,393.68
2030
$1,472.51
These projections assume Meta keeps executing on its current AI strategy. Turning business agents into a real revenue line would drive results higher, while sustained legal losses would pull them lower.
Contact [email protected] for any questions or corrections.
Meta Platforms Inc. (NASDAQ:META) reports third-quarter earnings Wednesday after the bell, with CEO Mark Zuckerberg under pressure to show returns on the company's soaring AI spending.
IFP Advisors Inc raised its stake in shares of Meta Platforms, Inc. (NASDAQ:META – Free Report) by 14.3% during the third quarter, according to its most recent filing with the Securities and Exchange Commission (SEC). The fund owned 47,417 shares of the social networking company’s stock after acquiring an additional 5,943 shares during the quarter. Meta Platforms makes up 0.6% of IFP Advisors Inc’s portfolio, making the stock its 26th biggest position. IFP Advisors Inc’s holdings in Meta Platforms were worth $34,386,000 as of its most recent filing with the Securities and Exchange Commission (SEC).
A number of other large investors have also recently added to or reduced their stakes in META. Corient Private Wealth LP raised its stake in shares of Meta Platforms by 723.1% in the 2nd quarter. Corient Private Wealth LP now owns 8,801,764 shares of the social networking company’s stock valued at $4,957,946,000 after purchasing an additional 7,732,446 shares in the last quarter. Jupiter Topco LLC bought a new position in shares of Meta Platforms during the second quarter worth about $2,948,486,000. State Street Corp lifted its position in shares of Meta Platforms by 4.0% during the second quarter. State Street Corp now owns 92,033,963 shares of the social networking company’s stock worth $51,841,811,000 after purchasing an additional 3,510,123 shares during the last quarter. Bank of America Corp DE grew its stake in Meta Platforms by 14.6% in the first quarter. Bank of America Corp DE now owns 21,038,035 shares of the social networking company’s stock worth $12,036,491,000 after purchasing an additional 2,673,494 shares in the last quarter. Finally, Amundi grew its stake in Meta Platforms by 18.1% in the first quarter. Amundi now owns 11,858,972 shares of the social networking company’s stock worth $6,784,873,000 after purchasing an additional 1,815,017 shares in the last quarter. 79.91% of the stock is currently owned by institutional investors.
Insider Activity at Meta Platforms In other news, CTO Andrew Bosworth sold 7,848 shares of the stock in a transaction that occurred on Tuesday, August 18th. The stock was sold at an average price of $558.00, for a total transaction of $4,379,184.00. Following the sale, the chief technology officer directly owned 828 shares in the company, valued at approximately $462,024. This represents a 90.46% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Susan Li sold 9,196 shares of the stock in a transaction that occurred on Tuesday, August 18th. The stock was sold at an average price of $550.61, for a total value of $5,063,409.56. Following the sale, the chief financial officer owned 13,186 shares in the company, valued at $7,260,343.46. The trade was a 41.09% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last three months, insiders sold 148,331 shares of company stock valued at $101,233,569. 13.53% of the stock is owned by insiders.
Meta Platforms Trading Down 1.6% NASDAQ META opened at $694.25 on Wednesday. The company has a debt-to-equity ratio of 0.32, a quick ratio of 2.23 and a current ratio of 2.23. Meta Platforms, Inc. has a one year low of $520.26 and a one year high of $779.82. The company has a 50-day simple moving average of $659.90 and a 200-day simple moving average of $628.23. The firm has a market capitalization of $1.77 trillion, a PE ratio of 26.15, a price-to-earnings-growth ratio of 1.24 and a beta of 1.19. Meta Platforms (NASDAQ:META – Get Free Report) last released its quarterly earnings data on Wednesday, July 29th. The social networking company reported $6.18 earnings per share for the quarter, missing the consensus estimate of $7.19 by ($1.01). Meta Platforms had a return on equity of 33.18% and a net margin of 29.83%. The business had revenue of $60.80 billion for the quarter, compared to analyst estimates of $60.22 billion. During the same quarter last year, the company earned $7.14 EPS. Meta Platforms’s revenue was up 28.0% compared to the same quarter last year. On average, equities analysts forecast that Meta Platforms, Inc. will post 27.95 earnings per share for the current year.
Meta Platforms Announces Dividend The business also recently announced a quarterly dividend, which was paid on Monday, September 28th. Shareholders of record on Monday, September 21st were paid a $0.5250 dividend. This represents a $2.10 dividend on an annualized basis and a yield of 0.3%. The ex-dividend date was Monday, September 21st. Meta Platforms’s payout ratio is presently 7.91%.
Key Headlines Impacting Meta Platforms Here are the key news stories impacting Meta Platforms this week:
Positive Sentiment: Meta’s Muse AI companion reportedly reached 10.9 million U.S. downloads in its first 40 days, putting it among the fastest-growing mobile applications. The adoption supports the view that Meta can use its massive user base to build new advertising, commerce and AI-assistant revenue streams. Muse download article Positive Sentiment: Analysts expect higher advertising revenue, stronger AI-driven engagement and increased monetization across Meta’s applications to support the upcoming quarter. Rosenblatt reaffirmed a buy rating and set an $886 price target, implying substantial upside from recent levels. Zacks earnings preview Positive Sentiment: Some investors argue Meta is well positioned for the next phase of AI because its social-app ecosystem and roughly 3.5 billion users could protect advertising and commerce revenue as AI assistants become more common. Meta versus Alphabet AI analysis Neutral Sentiment: Global affairs chief Joel Kaplan will leave Meta next year after 15 years. The leadership change may alter Meta’s political and regulatory strategy, although the company has not indicated an immediate operational impact. Reuters report on Joel Kaplan Negative Sentiment: The central near-term risk is Meta’s AI spending. Investors want evidence that surging infrastructure investment and potential funding needs will produce durable revenue growth without materially weakening margins or shareholder value. Reuters earnings preview Negative Sentiment: Shares have declined from their recent high as traders reduce risk before earnings and focus on whether the results and guidance can justify Meta’s premium valuation. The options market is also anticipating a sizable post-earnings move. Investopedia earnings volatility report Negative Sentiment: Broader concerns about an AI-stock sell-off, expensive data-center buildouts and possible equity financing are adding pressure to large technology companies, including Meta. Analyst Upgrades and Downgrades Several brokerages recently weighed in on META. Weiss Ratings raised Meta Platforms from a “hold (c+)” rating to a “buy (b-)” rating in a report on Thursday, October 8th. Needham & Company LLC restated a “hold” rating on shares of Meta Platforms in a research note on Thursday, August 27th. Piper Sandler lifted their target price on Meta Platforms from $785.00 to $875.00 and gave the stock an “overweight” rating in a research report on Friday, September 25th. Robert W. Baird lowered their price target on Meta Platforms from $830.00 to $750.00 and set an “outperform” rating for the company in a report on Thursday, July 30th. Finally, New Street Research lowered their price target on Meta Platforms from $730.00 to $700.00 and set a “buy” rating for the company in a report on Friday, July 31st. Three analysts have rated the stock with a Strong Buy rating, forty-seven have assigned a Buy rating and eight have assigned a Hold rating to the stock. Based on data from MarketBeat.com, the stock has an average rating of “Moderate Buy” and an average target price of $811.24.
Get Our Latest Research Report on META
Meta Platforms Company Profile (Free Report)
Meta Platforms, Inc is a technology company that develops social networking, messaging, virtual and augmented reality, and artificial intelligence products. The company’s principal platforms include Facebook, Instagram, Messenger, WhatsApp, and Threads, which enable users to connect, communicate, share content, and discover products and services.
Meta also operates Reality Labs, its division focused on virtual, augmented, and mixed reality technologies. Reality Labs develops products such as Meta Quest virtual reality headsets and related software and experiences, along with research and hardware intended to support immersive computing.
Further Reading Five stocks we like better than Meta Platforms Aurora Rejects Curaleaf’s Higher Bid, But the Takeover Fight Isn’t Over Centrus Energy Is Building a Nuclear Fuel Powerhouse—Why Is Its Stock Struggling? Halliburton Gains Traction: Multiyear Upcycle Ahead Meta Platforms’ AI Comeback Faces an Earnings Test—And a $10 Billion Charge Want to see what other hedge funds are holding META? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Meta Platforms, Inc. (NASDAQ:META – Free Report).
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Generali Investments Management Co LLC lifted its position in shares of Meta Platforms, Inc. (NASDAQ:META – Free Report) by 1.9% in the 3rd quarter, according to its most recent 13F filing with the SEC. The firm owned 42,037 shares of the social networking company’s stock after acquiring an additional 788 shares during the quarter. Meta Platforms makes up 5.8% of Generali Investments Management Co LLC’s investment portfolio, making the stock its 5th largest position. Generali Investments Management Co LLC’s holdings in Meta Platforms were worth $30,484,000 at the end of the most recent quarter.
Several other large investors also recently added to or reduced their stakes in META. Fairtree Asset Management Pty Ltd grew its stake in Meta Platforms by 18.6% in the 2nd quarter. Fairtree Asset Management Pty Ltd now owns 18,777 shares of the social networking company’s stock valued at $10,577,000 after buying an additional 2,939 shares in the last quarter. Madison Wealth Partners Inc lifted its position in shares of Meta Platforms by 33.6% during the second quarter. Madison Wealth Partners Inc now owns 3,031 shares of the social networking company’s stock worth $1,707,000 after acquiring an additional 763 shares in the last quarter. William John Sempolinski purchased a new stake in shares of Meta Platforms during the second quarter worth $3,107,000. Sone Capital Management LLC lifted its position in shares of Meta Platforms by 38.2% during the second quarter. Sone Capital Management LLC now owns 16,059 shares of the social networking company’s stock worth $9,046,000 after acquiring an additional 4,440 shares in the last quarter. Finally, Lakewood Capital Management LP lifted its position in shares of Meta Platforms by 63.7% during the second quarter. Lakewood Capital Management LP now owns 115,985 shares of the social networking company’s stock worth $65,333,000 after acquiring an additional 45,130 shares in the last quarter. Hedge funds and other institutional investors own 79.91% of the company’s stock.
Analysts Set New Price Targets Several brokerages have recently weighed in on META. Pivotal Research lifted their price target on Meta Platforms from $790.00 to $930.00 and gave the company a “buy” rating in a research report on Tuesday, October 13th. Daiwa Securities Group decreased their price objective on Meta Platforms from $790.00 to $687.00 and set a “buy” rating on the stock in a research note on Tuesday, August 4th. Wedbush boosted their price objective on Meta Platforms from $595.00 to $650.00 and gave the company a “neutral” rating in a research note on Friday, September 11th. Yorkville Ives began coverage on Meta Platforms in a report on Tuesday, October 6th. They set an “outperform” rating and a $900.00 price objective on the stock. Finally, DZ Bank restated a “buy” rating on shares of Meta Platforms in a research note on Thursday, July 30th. Three analysts have rated the stock with a Strong Buy rating, forty-seven have issued a Buy rating and eight have issued a Hold rating to the company’s stock. Based on data from MarketBeat.com, Meta Platforms has a consensus rating of “Moderate Buy” and an average price target of $811.24.
Read Our Latest Report on Meta Platforms Meta Platforms Stock Performance NASDAQ META opened at $694.25 on Wednesday. Meta Platforms, Inc. has a 1 year low of $520.26 and a 1 year high of $779.82. The company has a debt-to-equity ratio of 0.32, a current ratio of 2.23 and a quick ratio of 2.23. The stock has a market capitalization of $1.77 trillion, a PE ratio of 26.15, a P/E/G ratio of 1.24 and a beta of 1.19. The company’s 50 day simple moving average is $659.90 and its two-hundred day simple moving average is $628.23.
Meta Platforms (NASDAQ:META – Get Free Report) last announced its quarterly earnings results on Wednesday, July 29th. The social networking company reported $6.18 EPS for the quarter, missing the consensus estimate of $7.19 by ($1.01). The firm had revenue of $60.80 billion during the quarter, compared to the consensus estimate of $60.22 billion. Meta Platforms had a net margin of 29.83% and a return on equity of 33.18%. The firm’s revenue for the quarter was up 28.0% on a year-over-year basis. During the same period in the previous year, the business earned $7.14 earnings per share. Analysts predict that Meta Platforms, Inc. will post 27.95 earnings per share for the current fiscal year.
Meta Platforms Announces Dividend The firm also recently disclosed a quarterly dividend, which was paid on Monday, September 28th. Investors of record on Monday, September 21st were given a $0.5250 dividend. This represents a $2.10 dividend on an annualized basis and a dividend yield of 0.3%. The ex-dividend date was Monday, September 21st. Meta Platforms’s dividend payout ratio (DPR) is 7.91%.
Key Meta Platforms News Here are the key news stories impacting Meta Platforms this week:
Positive Sentiment: Meta’s Muse AI companion reportedly reached 10.9 million U.S. downloads in its first 40 days, putting it among the fastest-growing mobile applications. The adoption supports the view that Meta can use its massive user base to build new advertising, commerce and AI-assistant revenue streams. Muse download article Positive Sentiment: Analysts expect higher advertising revenue, stronger AI-driven engagement and increased monetization across Meta’s applications to support the upcoming quarter. Rosenblatt reaffirmed a buy rating and set an $886 price target, implying substantial upside from recent levels. Zacks earnings preview Positive Sentiment: Some investors argue Meta is well positioned for the next phase of AI because its social-app ecosystem and roughly 3.5 billion users could protect advertising and commerce revenue as AI assistants become more common. Meta versus Alphabet AI analysis Neutral Sentiment: Global affairs chief Joel Kaplan will leave Meta next year after 15 years. The leadership change may alter Meta’s political and regulatory strategy, although the company has not indicated an immediate operational impact. Reuters report on Joel Kaplan Negative Sentiment: The central near-term risk is Meta’s AI spending. Investors want evidence that surging infrastructure investment and potential funding needs will produce durable revenue growth without materially weakening margins or shareholder value. Reuters earnings preview Negative Sentiment: Shares have declined from their recent high as traders reduce risk before earnings and focus on whether the results and guidance can justify Meta’s premium valuation. The options market is also anticipating a sizable post-earnings move. Investopedia earnings volatility report Negative Sentiment: Broader concerns about an AI-stock sell-off, expensive data-center buildouts and possible equity financing are adding pressure to large technology companies, including Meta. Insider Buying and Selling In related news, COO Javier Olivan sold 946 shares of the business’s stock in a transaction dated Monday, October 12th. The stock was sold at an average price of $728.10, for a total transaction of $688,782.60. Following the completion of the transaction, the chief operating officer directly owned 6,932 shares in the company, valued at $5,047,189.20. The trade was a 12.01% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Mark Zuckerberg sold 27,474 shares of the company’s stock in a transaction dated Thursday, September 24th. The stock was sold at an average price of $777.44, for a total value of $21,359,386.56. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last quarter, insiders have sold 148,331 shares of company stock worth $101,233,569. Corporate insiders own 13.53% of the company’s stock.
Meta Platforms Company Profile (Free Report)
Meta Platforms, Inc is a technology company that develops social networking, messaging, virtual and augmented reality, and artificial intelligence products. The company’s principal platforms include Facebook, Instagram, Messenger, WhatsApp, and Threads, which enable users to connect, communicate, share content, and discover products and services.
Meta also operates Reality Labs, its division focused on virtual, augmented, and mixed reality technologies. Reality Labs develops products such as Meta Quest virtual reality headsets and related software and experiences, along with research and hardware intended to support immersive computing.
Read More Five stocks we like better than Meta Platforms Aurora Rejects Curaleaf’s Higher Bid, But the Takeover Fight Isn’t Over Centrus Energy Is Building a Nuclear Fuel Powerhouse—Why Is Its Stock Struggling? Halliburton Gains Traction: Multiyear Upcycle Ahead Meta Platforms’ AI Comeback Faces an Earnings Test—And a $10 Billion Charge Want to see what other hedge funds are holding META? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Meta Platforms, Inc. (NASDAQ:META – Free Report).
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Grant Private Wealth Management Inc lowered its position in Meta Platforms, Inc. (NASDAQ:META – Free Report) by 23.9% during the third quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission (SEC). The institutional investor owned 19,912 shares of the social networking company’s stock after selling 6,253 shares during the quarter. Meta Platforms makes up approximately 6.2% of Grant Private Wealth Management Inc’s holdings, making the stock its 2nd biggest position. Grant Private Wealth Management Inc’s holdings in Meta Platforms were worth $14,440,000 at the end of the most recent reporting period.
A number of other institutional investors and hedge funds have also recently bought and sold shares of META. Horizons Wealth Management acquired a new stake in shares of Meta Platforms during the 3rd quarter valued at about $33,000. Advantage Trust Co bought a new stake in shares of Meta Platforms in the 2nd quarter valued at approximately $28,000. Philadelphia Investment Partners LLC bought a new stake in shares of Meta Platforms in the 2nd quarter valued at approximately $32,000. Axiom Investment Management LLC bought a new stake in shares of Meta Platforms in the 1st quarter valued at approximately $36,000. Finally, Schuylkill Financial LLC bought a new position in Meta Platforms during the second quarter valued at approximately $36,000. Hedge funds and other institutional investors own 79.91% of the company’s stock.
Meta Platforms News Roundup Here are the key news stories impacting Meta Platforms this week:
Positive Sentiment: Meta’s Muse AI companion reportedly reached 10.9 million U.S. downloads in its first 40 days, putting it among the fastest-growing mobile applications. The adoption supports the view that Meta can use its massive user base to build new advertising, commerce and AI-assistant revenue streams. Muse download article Positive Sentiment: Analysts expect higher advertising revenue, stronger AI-driven engagement and increased monetization across Meta’s applications to support the upcoming quarter. Rosenblatt reaffirmed a buy rating and set an $886 price target, implying substantial upside from recent levels. Zacks earnings preview Positive Sentiment: Some investors argue Meta is well positioned for the next phase of AI because its social-app ecosystem and roughly 3.5 billion users could protect advertising and commerce revenue as AI assistants become more common. Meta versus Alphabet AI analysis Neutral Sentiment: Global affairs chief Joel Kaplan will leave Meta next year after 15 years. The leadership change may alter Meta’s political and regulatory strategy, although the company has not indicated an immediate operational impact. Reuters report on Joel Kaplan Negative Sentiment: The central near-term risk is Meta’s AI spending. Investors want evidence that surging infrastructure investment and potential funding needs will produce durable revenue growth without materially weakening margins or shareholder value. Reuters earnings preview Negative Sentiment: Shares have declined from their recent high as traders reduce risk before earnings and focus on whether the results and guidance can justify Meta’s premium valuation. The options market is also anticipating a sizable post-earnings move. Investopedia earnings volatility report Negative Sentiment: Broader concerns about an AI-stock sell-off, expensive data-center buildouts and possible equity financing are adding pressure to large technology companies, including Meta. Insider Activity at Meta Platforms In other Meta Platforms news, COO Javier Olivan sold 946 shares of the business’s stock in a transaction dated Monday, October 12th. The shares were sold at an average price of $728.10, for a total value of $688,782.60. Following the completion of the transaction, the chief operating officer directly owned 6,932 shares of the company’s stock, valued at approximately $5,047,189.20. The trade was a 12.01% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Christopher K. Cox sold 40,000 shares of the business’s stock in a transaction that occurred on Monday, September 21st. The stock was sold at an average price of $712.76, for a total transaction of $28,510,400.00. Following the completion of the transaction, the insider owned 184,516 shares of the company’s stock, valued at $131,515,624.16. This trade represents a 17.82% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 148,331 shares of company stock valued at $101,233,569 in the last three months. Corporate insiders own 13.53% of the company’s stock. Analyst Upgrades and Downgrades Several equities analysts recently weighed in on META shares. Barclays cut their price objective on shares of Meta Platforms from $830.00 to $780.00 and set an “overweight” rating on the stock in a research report on Thursday, July 30th. Tigress Financial reiterated a “strong-buy” rating and set a $945.00 price target (down from $995.00) on shares of Meta Platforms in a research note on Thursday, September 24th. New Street Research decreased their price objective on shares of Meta Platforms from $730.00 to $700.00 and set a “buy” rating for the company in a report on Friday, July 31st. Scotiabank reaffirmed a “sector perform” rating and set a $600.00 price objective (down from $700.00) on shares of Meta Platforms in a report on Thursday, July 30th. Finally, Arete Research raised their target price on shares of Meta Platforms from $735.00 to $806.00 and gave the company a “buy” rating in a research note on Wednesday, September 16th. Three research analysts have rated the stock with a Strong Buy rating, forty-seven have assigned a Buy rating and eight have given a Hold rating to the company. According to MarketBeat.com, the company has an average rating of “Moderate Buy” and an average price target of $811.24.
Read Our Latest Stock Report on META
Meta Platforms Stock Performance NASDAQ META opened at $694.25 on Wednesday. Meta Platforms, Inc. has a twelve month low of $520.26 and a twelve month high of $779.82. The stock has a market cap of $1.77 trillion, a P/E ratio of 26.15, a PEG ratio of 1.24 and a beta of 1.19. The company’s 50-day simple moving average is $659.90 and its 200 day simple moving average is $628.23. The company has a quick ratio of 2.23, a current ratio of 2.23 and a debt-to-equity ratio of 0.32.
Meta Platforms (NASDAQ:META – Get Free Report) last posted its earnings results on Wednesday, July 29th. The social networking company reported $6.18 EPS for the quarter, missing the consensus estimate of $7.19 by ($1.01). Meta Platforms had a return on equity of 33.18% and a net margin of 29.83%. The company had revenue of $60.80 billion for the quarter, compared to the consensus estimate of $60.22 billion. During the same quarter last year, the business earned $7.14 EPS. Meta Platforms’s quarterly revenue was up 28.0% compared to the same quarter last year. As a group, research analysts forecast that Meta Platforms, Inc. will post 27.95 earnings per share for the current fiscal year.
Meta Platforms Dividend Announcement The company also recently disclosed a quarterly dividend, which was paid on Monday, September 28th. Stockholders of record on Monday, September 21st were issued a dividend of $0.5250 per share. The ex-dividend date of this dividend was Monday, September 21st. This represents a $2.10 annualized dividend and a dividend yield of 0.3%. Meta Platforms’s dividend payout ratio (DPR) is presently 7.91%.
About Meta Platforms (Free Report)
Meta Platforms, Inc is a technology company that develops social networking, messaging, virtual and augmented reality, and artificial intelligence products. The company’s principal platforms include Facebook, Instagram, Messenger, WhatsApp, and Threads, which enable users to connect, communicate, share content, and discover products and services.
Meta also operates Reality Labs, its division focused on virtual, augmented, and mixed reality technologies. Reality Labs develops products such as Meta Quest virtual reality headsets and related software and experiences, along with research and hardware intended to support immersive computing.
Read More Five stocks we like better than Meta Platforms Aurora Rejects Curaleaf’s Higher Bid, But the Takeover Fight Isn’t Over Centrus Energy Is Building a Nuclear Fuel Powerhouse—Why Is Its Stock Struggling? Halliburton Gains Traction: Multiyear Upcycle Ahead Meta Platforms’ AI Comeback Faces an Earnings Test—And a $10 Billion Charge
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US stock futures rose after strong results from SpaceX eased concerns over whether a global investment spree in artificial intelligence can prove sustainable. Meta investors will be looking for any updates on the company's artificial intelligence spending when it reports quarterly results on Wednesday after the market close.
Meta Platforms reports third-quarter earnings on Wednesday with Wall Street facing a test of whether the artificial intelligence boom is producing enough cash to justify its enormous investment bill.
Analysts expect $63.42 billion in revenue, up nearly 24% annually, but also forecast $41.68 billion in capital expenditure and an $8.52 billion free cash outflow.
The danger for investors is that Meta could exceed sales expectations yet still disappoint if Mark Zuckerberg signals another sharp increase in spending.
Such an outcome would challenge the assumption that rapid AI adoption automatically deserves higher technology-stock valuations.
Meta's advertising franchise remains formidable. AI recommendations are helping advertisers reach users more effectively, while Facebook and Instagram continue attracting marketing budgets.
BofA Global Research analysts said recent AI launches had strengthened their confidence in Meta's execution, according to Reuters on Tuesday. Their survey also indicated healthy advertising demand.
LSEG expects net income of $15.44 billion, about 17% below the year-earlier figure excluding a one-off tax charge. On a reported basis, profit would rise sharply from last year's $2.71 billion.
More revealing is the cash-flow swing. Meta produced just $784 million in free cash flow in the June quarter despite reporting nearly $16 billion in net income. Analysts now expect an $8.52 billion outflow for September.
That is the potential reality check, as accounting profits can look impressive even as infrastructure investment absorbs cash that might otherwise fund buybacks, dividends or further expansion.
Meta already projects $130 billion to $145 billion in capital expenditure for 2026, including finance-lease principal payments.
Rosenblatt Securities analyst Barton Crockett remains bullish, maintaining a Buy rating and $886 target. Yet he considers spending approaching $200 billion in 2027 plausible.
That upper scenario would be at least 38% above the top of Meta's current annual guidance, though it is an analyst projection rather than company guidance.
Higher investment could boost the advertising engine and establish new AI businesses. But the financial market is now asking when those additional billions will earn an adequate return, particularly as computing hardware depreciates and new products compete for customers.
A larger spending forecast without evidence of rising returns could force analysts to lower cash-flow projections and investors to pay less for each dollar of expected future earnings.
It could also unsettle Nvidia and other suppliers if investors conclude the sector's spending surge is becoming financially difficult to sustain.
Meta's new Muse assistant has attracted more than nine million US downloads and roughly 2.3 million daily active users.
Those figures demonstrate interest, not profitability. Free usage costs money to serve, and subscriptions or enterprise sales may take time to scale.
BMO analyst Brian Pitz, quoted by TipRanks on Wednesday, said he wanted "clear monetization flowthrough and visibility into 2027E cost trajectory". He reiterated a Hold rating and $580 target, reflecting a more cautious stance than Rosenblatt.
The market is positioned for a consequential surprise. Options imply a roughly 6.3% move in Meta shares by week's end.
Investopedia counted 18 Buy recommendations among 19 analysts, illustrating how vulnerable bullish expectations could become to sharply disappointing guidance.
Clear evidence that Muse can earn revenue, alongside stable spending guidance, could support the bullish case.
But weak monetisation combined with another capital expenditure increase would show that even an advertising powerhouse cannot escape the economics of AI infrastructure.
Meta’s Joel Kaplan – Mark Zuckerberg’s right-hand man in Washington, DC – will step down next year as the company’s chief global affairs officer, the company confirmed Tuesday.
Kaplan, a Republican who served as deputy chief of staff for former President George W. Bush, will remain at the helm of Meta’s policy team through the midterms and leave at some point in 2027, a company spokesperson said.
Kaplan spent more than 15 years at Meta and took over as its global policy chief following the departure of left-leaning Nick Clegg in January 2025.
Meta Chief Global Affairs Officer Joel Kaplan arrives at the E. Barrett Prettyman United States Court House on April 14, 2025 in Washington, DC. Getty Images
“I’ll be at the company for a few months to help with the transition, and then look forward to catching my breath,” Kaplan wrote on X, adding that he planned to spend more time with his family and “figure out what I want to do next.”
The exec was widely seen as the most vocal champion for conservatives at Meta – and was credited internally with ensuring a consistent approach on Zuckerberg’s shift away from fact-checking and censorship on Facebook and Instagram.
He also played a key role in fostering Meta’s closer ties with President Trump, who once reviled the company.
In a statement to Axios, Zuckerberg said Kaplan “has worked on virtually every tough issue Meta has faced for more than 15 years.
“When he arrived, there was no playbook for ensuring our products would be available to the billions of people around the world who now rely on them. And throughout all of it, he’s been a strong advocate for our policies, and a friend to me,” Zuckerberg added.
Meta did not say who will replace Kaplan in the role, though several executives are poised to take on his responsibilities.
Mark Zuckerberg has built a closer relationship with President Trump since his inauguration. Getty Images
Dina Powell McCormick and Joel Kaplan attend the UFC Freedom 250 celebration hosted by Meta and UFC at Ned’s Club Washington, DC, on June 12. Getty Images for Meta and UFC
They include Dina Powell McCormick, a president and vice chairman at Meta who will add external affairs to her portfolio as part of the transition, a spokesperson confirmed.
Powell served in the Trump administration during the president’s first term in office and previously worked at Goldman Sachs.
She is spearheading Meta’s campaign to build out data centers and other infrastructure needed to support the artificial intelligence boom.
Other key individuals include CJ Mahoney, who became Meta’s chief legal officer in January and played an important role in brokering the company’s controversial $18 billion settlement with a coalition of state attorneys general who accused the company of fueling a teen mental health crisis.
Meta's rollout of its new Muse AI agent marks a pivotal moment for the tech giant. But investors are questioning whether the model will be a lucrative revenue driver or an expensive defensive move.
