Meta Platforms CEO Mark Zuckerberg departs the workplace of U.S. Majority Chief John Thune (R-SD) following a gathering on the U.S. Capitol in Washington, D.C., U.S., March 26, 2026.
Nathan Howard | Reuters
Meta shares dropped greater than 5% in prolonged buying and selling on Wednesday after the corporate issued a weaker-than-expected income forecast and took an enormous hit to its money pile.
This is how the corporate did, in contrast with estimates from analysts polled by LSEG:
- Earnings per share: $6.18 vs. $7.22
- Income: $60.80 billion vs. $60.17 billion
Meta stated it expects income this quarter of between $61 billion and $64 billion, or $62.5 billion on the center of the vary. Analysts have been anticipating steerage of $63.15 billion, in accordance with LSEG. The corporate stated that the steerage “assumes overseas foreign money is an roughly 1% headwind to year-over-year whole income development, based mostly on present alternate charges.”
The corporate stated that each day lively individuals, or DAP, got here in at 3.6 billion, trailing Wall Avenue estimates of three.61 billion, in accordance with StreetAccount.
For capital expenditures, Meta narrowed its steerage for the yr to between $130 billion and $145 billion from a previous vary of $125 billion to $145 billion. With Meta pouring cash into synthetic intelligencer infrastructure, Meta’s free money circulation dwindled to $784 million within the quarter from $8.55 billion a yr earlier.
Final week, rival Alphabet reported that free money circulation turned destructive for the primary time on report as a result of Web giants hefty AI investments. Nonetheless, not like Alphabet and fellow hyperscalers Amazon and Microsoft, Meta would not have a thriving cloud-computing enterprise.
Meta shares are down 11% for the yr as of Wednesday’s shut, whereas the Nasdaq is up about 5% over that stretch.
On the earnings name, buyers can be listening intently to what Meta CEO Mark Zuckerberg has to say in regards to the firm’s efforts to extra immediately monetize its varied AI-related efforts. Earlier this month, Meta debuted the Muse Spark 1.1 mannequin, which AI chief Alexandr Wang stated represents the “strongest mannequin for agentic and coding work but” and at a less expensive value than choices from OpenAI and Anthropic.
The corporate has been aggressively investing in a brand new AI technique since hiring Wang in June 2025 in a deal that concerned a $14.3 billion funding in Scale AI, Wang’s startup. In the meantime, Meta is pouring cash into AI infrastructure because it tries to maintain tempo with Alphabet, Amazon and Microsoft relating to constructing knowledge facilities and securing AI chips and programs wanted to run fashions and workloads.
On Tuesday, Meta introduced a enterprise with BlackRock to create a $14 billion knowledge heart undertaking in El Paso, Texas, only a few weeks after disclosing that its huge Hyperion knowledge heart undertaking in rural Louisiana would price over $50 billion. Earlier in July, Meta revealed plans to construct a $9 billion knowledge heart in Alberta, Canada.
Meta stated second-quarter whole prices and bills got here in at $42.03 billion, representing a rise of 55% from a yr in the past. That determine contains $2.4 billion of fees associated to authorized proceedings and $1.18 billion of severance bills in reference to the corporate’s layoffs that started in Could.
Web revenue for the interval slid 13% to $15.85 billion from $18.34 billion, or $7.14 per share, in the identical quarter final yr.
Meta’s Actuality Labs unit generated $4.6 billion in second-quarter working losses whereas bringing in $431 million in gross sales. Wall Avenue was anticipating that unit, which develops digital actuality and associated AI-powered wearable gadgets, to report a second-quarter lack of $5.07 billion on income of $423.4 million.
WATCH: AI and capex in focus for Meta this week: This is what to anticipate.
