Meta Platforms, the social media and technology company behind Facebook, Instagram and WhatsApp, beat revenue and underlying earnings forecasts for the third quarter of 2026, though a nearly $10 billion legal settlement charge heavily distorted the headline figures.
Revenue came in at $64.6 billion, up 26% year on year and ahead of the $63.2 billion to $63.35 billion Wall Street consensus.
Reported net income was $9.86 billion, producing diluted earnings per share of $3.83, but that figure was dragged down by a $9.89 billion charge related to an agreement with 52 US state attorneys general over teen mental health and social media.
Stripping out the charge, diluted EPS would have been $7.40, comfortably above the upper end of analyst forecasts.
Operating income on the same basis would have been $22.88 billion, compared with the reported $12.99 billion and an operating margin of 20%.
The advertising business remained the engine of growth.
Ad impressions across Meta's family of apps rose 10% year on year, while the average price per ad climbed 14%, a combination that drove advertising revenue to $63.06 billion.
Family daily active people, the company's measure of combined users across its apps, reached 3.64 billion in September, up 3% year on year.
Capital expenditure of $34.91 billion in the quarter pushed free cash flow into negative territory at minus $2.12 billion, reflecting the scale of Meta's AI infrastructure build.
The company narrowed its full-year 2026 capital expenditure guidance to $135 billion to $145 billion, from a prior range of $130 billion to $145 billion.
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Fourth quarter revenue guidance of $73 billion to $76 billion was strong, implying continued double-digit growth into year end.
Meta also announced the creation of a new Class C common stock, a non-voting share class, with an effective date of January 2027.
Shareholders will receive one Class C share for each existing Class A or Class B share held, in a structure that functions as a two-for-one stock split without altering voting rights.
The move preserves founder and chief executive Mark Zuckerberg's voting control while giving Meta a new currency for capital raising, acquisitions and employee compensation.
