Meta Q3 2026 Earnings: Its AI Build Now Costs More Cash Than Its Business Brings In

By Stock Titan Editorial Team Published October 21, 2026, 04:15 PM EDT · Updated October 21, 2026, 06:13 PM EDT

Meta Q3 2026 earnings: revenue, profit and users

Meta Platforms, the owner of Facebook, Instagram, WhatsApp and Messenger, reported revenue of $64.60 billion for the third quarter of 2026 on October 21 (Meta's results release on StockTitan). Advertising made up $63.06 billion of it.

Meta showed more ads than a year earlier and charged more for each one, and its apps reached more people every day. The data panel below has those figures.

Profit per share, which Meta reports as diluted earnings per share, was $3.83, against $1.05 a year earlier. Both quarters carry a large one-time item, so the reported jump says little.

Without them, by Meta's own figures, profit per share was $7.40, against $7.25 a year earlier (Meta's third quarter 2025 release).

That is growth of about 2%, by our calculation, in a quarter when sales grew 26%.

Costs rose 68%, and operating margin, the share of sales left after running costs, fell to 20% from 40%, much of it from a $9.89 billion charge for Meta's teen safety settlement, explained below.

Without that charge, costs rose about 36% and the margin was about 35%, by our calculation from Meta's figures, still below a year earlier.

What we calculated. Spending against cash comes from Meta's own cash flow statement. The peer comparison divides each company's equipment spending by its cash from operations. The lease total adds the two amounts in Meta's July quarterly report. Figures are as of Meta's October 21 release; Meta had not posted the call transcript when this was written.

Did Meta beat its own revenue forecast for Q3 2026?

Revenue of $64.60 billion beat the $61 billion to $64 billion range from Meta's July release (Meta's previous results release). That test uses Meta's own forecast; analysts' estimates differ by provider.

Over the 10 quarters from Q2 2024 to Q3 2026, revenue topped the high end of Meta's range 7 times, by StockTitan's count of Meta's releases. In the other 3, it landed inside the range.

Show the data

Item	Low	High	Value
Q2 2024	$36.5B	$39.0B	$39.1B
Q3 2024	$38.5B	$41.0B	$40.6B
Q4 2024	$45.0B	$48.0B	$48.4B
Q1 2025	$39.5B	$41.8B	$42.3B
Q2 2025	$42.5B	$45.5B	$47.5B
Q3 2025	$47.5B	$50.5B	$51.2B
Q4 2025	$56.0B	$59.0B	$59.9B
Q1 2026	$53.5B	$56.5B	$56.3B
Q2 2026	$58.0B	$61.0B	$60.8B
Q3 2026	$61.0B	$64.0B	$64.6B

Does Meta's business still bring in enough cash for its AI spending?

Capital expenditures, or capex, is money spent on things that last for years: data center buildings, the servers and chips inside them, and the network that links them. Meta's quarterly report says the money is going "as we continued to invest in servers, data centers, and network infrastructure" (Meta 10-Q for the quarter ended June 30, 2026).

Of the $34.91 billion, $33.94 billion was the part Meta bought outright, the part we compare with past years below.

The other $964 million went to payments on leased equipment.

Cash from operations, the money the business itself brought in after paying its running costs, was $32.79 billion. The $33.94 billion bought outright is more than in any earlier quarter in StockTitan's fundamentals data, which goes back to 2011.

Show the data

Category	Cash from operations	Capital expenditures
Q1 2024	$19.2B	$6.7B
Q2 2024	$19.4B	$8.5B
Q3 2024	$24.7B	$9.2B
Q4 2024	$28.0B	$14.8B
Q1 2025	$24.0B	$13.7B
Q2 2025	$25.6B	$17.0B
Q3 2025	$30.0B	$19.4B
Q4 2025	$36.2B	$22.1B
Q1 2026	$32.2B	$19.8B
Q2 2026	$31.9B	$31.1B
Q3 2026	$32.8B	$34.9B

For most of 2024 the two lines sat far apart. The gap between them was money Meta used for buybacks, dividends and savings, and the chart shows it closing as the build grew.

In July, Meta's finance chief, Susan Li, said on a call with analysts: "I think for now, again, our operating cash flow is really the primary pillar by which we are financing all of our ambitions." (Meta's follow-up call transcript, second quarter 2026). She also pointed to bond sales and data center partnerships. By our reading, one quarter later that pillar no longer covered the whole build by itself.

Research and development, the engineers and computing behind Meta's AI work, reached $20.05 billion, against $15.14 billion a year earlier.

Meta ended the quarter with 15% fewer employees than a year earlier, while its spending on data centers and equipment rose 80%, by our calculation. By our reading, the trade is fewer people and more machines.

Mark Zuckerberg, its chief executive, said in the release: "Our investments are paying off, the core business is strong". The test so far: ad sales rose 26%, while profit per share before one-time items rose about 2%.

Show the data

Step	Value
Cash from operations	$32.79B
Property and equipment	-$33.94B
Finance lease payments	-$0.96B
Free cash flow	-$2.12B

Free cash flow, the cash left after paying for equipment, bought or leased, was minus $2.12 billion, against $10.63 billion a year earlier. It is the lowest in the 11 quarters charted below.

Show the data

Category	Value
Q1 2024	$12.53B
Q2 2024	$10.90B
Q3 2024	$15.52B
Q4 2024	$13.15B
Q1 2025	$10.33B
Q2 2025	$8.55B
Q3 2025	$10.63B
Q4 2025	$14.08B
Q1 2026	$12.39B
Q2 2026	$0.78B
Q3 2026	-$2.12B

We checked StockTitan's fundamentals data, which holds every Meta quarter back to 2011, on a simpler basis: cash from operations minus purchases of property and equipment alone. This quarter that came to minus $1.16 billion.

The only earlier quarters below zero on that basis were the first two quarters of 2012, around the time Facebook went public in May 2012.

Amazon and Alphabet crossed this line first, in April to June, by our calculation from their own results, and Microsoft had not. Meta's reached 104% in July to September. All four leave out leased equipment, which can make a company that leases heavily look lower, and the chart shows each company by quarter.

Show the data

Category	Value
Amazon, Apr to Jun	119%
Alphabet, Apr to Jun	115%
Meta, Apr to Jun	95%
Meta, Jul to Sep	104%
Microsoft, Apr to Jun	65%

Did Meta change its 2026 capex guidance?

Meta's outlook commentary in the release reads: "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."

The bottom of the range went up by $5 billion, so the least Meta now plans to spend is higher than it was in July.

Meta has spent $85.8 billion so far this year, by our sum of its quarterly figures.

Landing at the low end would take about $49.2 billion more in the last quarter, and the high end about $59.2 billion.

Show the data

Item	Low	High	Value
April outlook	$125.0B	$145.0B	$19.8B
July outlook	$130.0B	$145.0B	$50.9B
October outlook	$135.0B	$145.0B	$85.8B

The plan has moved up since January, when Meta expected $115 billion to $135 billion; the chart shows each later step.

For comparison, Meta spent $72.22 billion in all of 2025, by its own count (Meta's fourth quarter 2025 release).

On next year, the release says: "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." In plain words, Meta expects to keep spending heavily in 2027 but has not put a number on it.

How is Meta paying for its data centers?

Its savings shrank. Cash and marketable securities, investments it can sell quickly, fell to $82.45 billion from $90.26 billion at the end of June (Meta's second quarter release).

That drop of $7.81 billion, by our calculation, is larger than the $2.12 billion shortfall.

Meta also paid $4.06 billion of taxes on employees' vested stock and $1.36 billion of dividends, among other payments.

It borrowed $24.91 billion in the first nine months of 2026, all of it in the second quarter, according to its cash flow statement. That was a bond sale completed on May 4 (Meta's 8-K of May 4, 2026).

Long-term debt stood at $80.92 billion at the end of September, against $58.74 billion at the end of 2025.

Meta has bought back no shares in 2026, after spending $26.25 billion on them in the first nine months of 2025. It still paid $1.36 billion in dividends in the quarter.

Meta has also signed leases that have not started: about $278.99 billion as of June 30, and about $68 billion more in July (Meta's 10-Q). They cover data centers, space it rents inside other companies' data centers, and network gear.

Together that is about $347 billion by our sum, paid over terms of up to 30 years, or roughly 1.4 times a year of Meta's revenue.

What is Meta's new Class C stock?

What holders get. Each Class A and Class B share will receive one Class C share as a stock dividend, a payout in shares (Meta's results release on StockTitan). Meta expects the Class A price to reflect the effect of a two-for-one stock split, so each share stands for half as much ownership while its vote stays the same.

Does it change my share of the profits? Not at first. Meta's information statement says the change "will not initially affect the relative voting power or economic interest of any shareholder", and that all three classes "share ratably on a per share basis in connection with any dividends or distributions" (Meta's information statement, October 21, 2026).

Later sales are another matter. Selling new shares of any class spreads profits over more shares. The statement says the economic dilution from new shares "can be mitigated by endeavoring to receive value commensurate with the capital stock that we issue", while a class with no vote avoids voting dilution. That means Meta would aim to get a fair price for any new shares it sells.

Is the stock dividend taxed? For U.S. federal income tax purposes, Meta says "we do not expect to treat either the Recapitalization or the Dividend as taxable to our shareholders", the Recapitalization being its word for the share change. If that holds, each old share's tax basis, the amount used to work out a later gain or loss, would be split between the old and new shares by their market values on the dividend date.

Meta tells holders to ask their own tax advisers.

How the votes work today. A Class A share, the kind traded on Nasdaq, has one vote, and a Class B share has ten. Holders of Class B, including Mr. Zuckerberg, hold most of the votes, according to Meta's 10-Q.

Why Meta says it needs it. Under a heading on raising capital, the release says: "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." In plain terms, Meta is saying the AI build is expensive, and the special committee says the new class gives Meta "the ability to finance its growth".

Why control stays put. The release ties the move to keeping Mr. Zuckerberg in charge; a special committee of independent directors concluded that he "is best suited to lead Meta into its next era and beyond." By our reading, that is the point of a share with no vote: new Class C shares add no votes.

Who approved it. Holders with enough votes signed off in writing instead of at a meeting, which Meta calls a written consent. Meta also signed a Founder Alignment Agreement with Mr. Zuckerberg, set out in the next section.

When. The change is set to take effect on January 19, 2027 (Meta's results release). The board will set the record date, the cutoff for who gets the new shares. Payment comes no later than five business days after the change takes effect, the statement says.

The question was already in the air. On the July call, Youssef Squali of Truist Securities asked: "And would you consider using equity to potentially fund some of these investments over time?" Ms. Li said Meta had no plans to share on that then, and that "as we plan for our investments in 2027, I think we will certainly evaluate all of the financing options." (Meta's follow-up call transcript). By our reading, the new share class is one such option.

What did Zuckerberg agree to, and why does California's wealth tax matter?

What he agreed to. Meta's preliminary information statement on Schedule 14C, the notice Meta must send shareholders after a change approved in writing, spells out the Founder Alignment Agreement. Of the Class C shares he receives, it says "20% of the shares of Class C common stock to be issued to the Holder Group in the Dividend will be freely saleable and the other 80% of the shares of Class C common stock will be subject to sale and transfer restrictions" (Meta's preliminary information statement). The Holder Group is the filing's term for Mr. Zuckerberg and certain people or entities he may pass shares to.

The statement says he may generally sell a restricted share only if, "for each such Stapled Class C Share sold, the Holder Group, no later than two business days after the settlement of such sale, sells one share of Class A or Class B common stock, or converts one share of Class B common stock into a share of Class A common stock". A Stapled Class C Share is the filing's name for a restricted share.

In plain words, selling restricted shares generally requires a matching sale or conversion of voting shares, one for one, which lowers his voting power: selling a Class A share removes one vote, and turning a Class B share, with ten votes, into a Class A share, with one, removes nine. The agreement also allows credits from earlier sales and a reduced ratio in some cases.

The restrictions come off in steps: 2.5% of his new shares each quarter while he "remains employed by the Company on the executive team or as the executive chair of the Board, in either case, on a full-time basis". The statement adds: "Upon the thirty-second calendar quarter in which the Continued Leadership Condition has been satisfied at all times, all remaining Stapled Class C Shares then held by the Holder Group will be released from the Stapling Condition." That takes 32 qualifying quarters, not necessarily in a row; quarters that do not qualify do not count, and no shares are lost.

He also committed, for eight years from the date of the agreement and as long as he stays a full-time leader, "to remain a resident of California or any other jurisdiction in which the Company maintains its corporate headquarters, absent material unforeseen circumstances rendering it prudent or advisable for him to reside elsewhere", Meta says.

More shares if the stock doubles. Under a section titled "The Issuance of Additional Class C Dividends Is Subject to Future Company Success Under Mr. Zuckerberg", the board agreed, subject to legally available funds, to declare another one-for-one Class C dividend, at most one per doubling, when the Class C average price "reaches a successive doubling, initially 2x, then 4x, then 8x and so on, of the corresponding price of the Class A common stock on September 10, 2026 of $580.60 per share".

The filing measures that price as a volume weighted average over the 30 consecutive trading days before each check, an average that gives more weight to days when more shares change hands.

A second test must also hold: the yearly shareholder return since September 10, 2026, counted with dividends reinvested, "is no less than 10%". The extra shares go to all holders, "not just Mr. Zuckerberg’s", the statement says.

In plain words, each time the Class C price doubles from that starting point and the return test holds, every holder would get another share for each one they own.

The filing says the $580.60 starting price is "as equitably adjusted for stock splits, stock dividends, recapitalizations and other equitable adjustments (including with respect to the Dividend)". In the agreement's definition of the return test, the adjusted starting price is $290.30 per share, half of $580.60.

The reasons Meta gives. Meta says it wants him leading from California. The statement says: "Again, the goal is to keep Mr. Zuckerberg continuing to lead the Company from California and in close proximity to Meta Superintelligence Labs."

Under the heading "Ensure That Mr. Zuckerberg Remains in a Leadership Role at the Company’s Headquarters", the statement says: "If California’s Proposition 40, a statewide ballot measure on the November 3, 2026 general election ballot and commonly referred to as the “California wealth tax,” is enacted as law in California, it is expected that Mr. Zuckerberg could become liable for a significant, multi-billion dollar tax payment based on his ownership of stock in the Company."

It adds that "Mr. Zuckerberg informed the Special Committee that he was evaluating relocating his primary residence outside California". The statement says the special committee then "secured Mr. Zuckerberg’s commitment to remain a resident of California", the eight-year commitment described above.

Under the heading "Mr. Zuckerberg Will Not Receive Additional Compensation as a Result of the Recapitalization", the statement notes his $1 yearly salary since 2013 and says: "If the California wealth tax is enacted and Mr. Zuckerberg becomes liable for a tax payment, Mr. Zuckerberg would effectively be paying to serve as the Company’s chief executive officer while residing in California."

In plain words, Meta says the 20% of new shares he can sell freely give him a way to pay a possible wealth tax bill without giving up votes. He has also committed to live in California, or wherever Meta has its headquarters, for eight years while he leads Meta full time, barring what the filing calls material unforeseen circumstances.

The filing gives no dollar figure beyond "significant, multi-billion dollar", no forecast of whether the measure passes, and no plan for how many of his free shares he would sell.

How much did the teen safety settlement cost Meta?

The agreement, with 52 attorneys general, provides for payments of up to about $18.59 billion, the release says.

The agreement also changes the apps. Meta's August 26 announcement lists a default two-hour daily limit for teens and a default block of its apps from midnight to 6 a.m. (Meta's announcement on StockTitan). Both await court approval.

More cases are coming. In the release, Meta says it has "a number of youth-related trials scheduled in the coming months in the U.S." Its July quarterly report said the next two bellwether trials, test cases for many similar suits, were set to begin on October 28, 2026.

How much money is Meta Reality Labs losing?

Reality Labs had $443 million of revenue, against $470 million a year earlier.

Its loss so far in 2026 is $12.78 billion, by Meta's nine-month figure.

Meta now expects the unit to lose $18 billion to $19 billion in 2026. That implies a fourth quarter loss of about $5.2 billion to $6.2 billion, by our calculation.

For 2027 Meta expects a loss of around $15 billion, "as we reallocate investment toward other priority areas, primarily AI," the release says.

What did Meta forecast for the fourth quarter?

At the middle of that range, sales would be about 24% higher than a year earlier, by our calculation.

Meta expects currency moves to shave about 1 point off that growth, which it calls a headwind. A stronger dollar makes sales abroad worth fewer dollars.

It raised its full-year cost forecast to $175 billion to $179 billion.

Meta says the rise reflects the $9.9 billion legal charge.

Without that charge, Meta still expects 2026 operating income to beat 2025's. It expects a tax rate of 15% to 17% in the fourth quarter.

Three dates matter next. On November 3, California votes on Proposition 40, the wealth tax Meta's filing ties to the founder deal, so the vote decides whether the tax the filing describes becomes law (Meta's preliminary information statement).

On January 19, 2027, the new share class is scheduled to take effect. The board has yet to set the record and payment dates, and the information statement provides for payment within five business days after the change takes effect, subject to applicable law (Meta's results release, Meta's preliminary information statement).

Before then, Meta's July report set the next teen trials for October 28 (Meta's 10-Q). The call transcript and Meta's third quarter 10-Q will add management's words on funding and updated lease figures.

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