Meta Platforms reported a 26% increase in third-quarter revenue to $64.60 billion on October 21, 2026, but operating profit fell 37% as a multibillion-dollar legal charge pushed expenses sharply higher.
The parent company of Facebook, Instagram and WhatsApp generated $12.99 billion in operating income for the quarter ended September 30, down from $20.54 billion a year earlier, according to its quarterly earnings release.
Revenue increased from $51.24 billion over the same period. Total costs and expenses rose 68% to $51.61 billion, outpacing revenue growth. Meta’s operating margin narrowed to 20% from 40% in the third quarter of 2025.
Legal Charge Weighs
The largest identifiable factor behind the operating-profit decline was a $9.89 billion charge associated with Meta’s August agreement with 52 U.S. attorneys general to resolve litigation concerning teen mental health and social media.
The agreement provides for payments of up to approximately $18.59 billion, according to the company’s financial disclosures. Excluding the third-quarter charge, Meta said operating income would have been $22.88 billion, rather than the reported $12.99 billion.
That adjusted figure would represent approximately 11.4% growth from the $20.54 billion reported a year earlier, based on a comparison of the company’s disclosed results. The corresponding operating margin would be approximately 35.4%, compared with the reported 20%.
The adjustment does not eliminate the legal expense or change Meta’s reported earnings. It shows how much the charge affected the comparison with last year’s operating performance.
Meta reported net income of $9.86 billion, up from $2.71 billion a year earlier. Diluted earnings per share increased to $3.83 from $1.05. That increase also reflects a substantially lower income-tax provision than in the comparable 2025 quarter and should not be confused with growth in operating profit.
Advertising Business Grows
Meta’s advertising operations continued expanding even as overall operating profitability weakened. Advertising impressions across its Family of Apps increased 10% from a year earlier, while the average price per advertisement rose 14%. Average daily active users across the company’s family of applications reached 3.64 billion in September, an increase of 3%.
The stronger advertising figures help explain how revenue continued rising despite weaker reported margins. Growth in both advertising volume and average prices supported sales, although those operating measures cannot be used alone to reconstruct total revenue growth.
A comparison with Meta’s second-quarter results shows that year-over-year revenue growth slowed from 28% to 26%. Operating margin also fell from 31% in the second quarter to 20% in the third, although the latest period included the unusually large legal charge.
The divergence between sales growth and reported profitability provides fresh company-level evidence for investors assessing technology-sector earnings, following the Nasdaq technology selloff covered by Investozora earlier in October.
Spending Outlook Rises
Meta reported $34.91 billion in third-quarter capital expenditures, including principal payments on finance leases, reflecting continued investment in infrastructure and computing capacity.
Operating cash flow reached $32.79 billion, but free cash flow was negative $2.12 billion under the company’s non-GAAP definition, which subtracts equipment purchases and finance-lease principal payments.
For the fourth quarter, Meta projected revenue between $73 billion and $76 billion. It also raised its full-year expense outlook to $175 billion–$179 billion, incorporating the legal charge, and narrowed its 2026 capital-expenditure forecast to $135 billion–$145 billion. These are management projections, not completed financial results.
Meta’s latest figures leave investors with two distinct measures to monitor: whether advertising revenue continues growing and whether the company can sustain operating profitability while funding substantial infrastructure investment and absorbing legal costs. The company’s next reported financial results will provide the next quarterly comparison against its current spending and revenue projections.
