Meta Platforms reported third-quarter revenue of $64.60 billion, a 26% increase year-over-year, surpassing analyst expectations of $63.3 billion. Diluted earnings per share reached $3.83, compared to $1.05 in the same period last year. The company's net income rose to $9.86 billion.
The financial results include a $9.89 billion charge related to a legal settlement with 52 attorneys general concerning teen mental health. Total costs and expenses increased by 68% to $51.61 billion, while the operating margin declined to 20%. Advertising revenue reached $63.06 billion.
Meta announced a two-for-one stock split through the issuance of non-voting Class C shares, scheduled to take effect on January 19, 2027. The new shares will be listed on the Nasdaq. CEO Mark Zuckerberg retains 60.6% voting control, with new restrictions placed on the sale of his Class C shares.
Capital expenditures for the quarter totaled $34.91 billion, resulting in negative free cash flow of $2.12 billion. The company's headcount decreased by 15% to 66,775 employees. Meta projects fourth-quarter revenue between $73 billion and $76 billion.
Reality Labs expects losses to narrow to approximately $15 billion next year from the current range of $18 billion to $19 billion. The company is shifting investment focus toward artificial intelligence, specifically the Muse personal agent and Muse Wonder model, which have reached over 10 million users.
