Meta's Q3 revenue of $64 billion beats expectations; announces 2-for-1 stock split and raises 2026 capital expenditure floor

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Meta released its third-quarter earnings report after the close on Wednesday, kicking off the earnings season for large technology companies. The company's revenue beat expectations, but GAAP earnings per share were weighed down by legal costs related to a settlement over teen mental health. At the same time, Meta announced a plan to create a new class of non-voting Class C stock to be distributed to existing investors as a stock dividend, effectively equivalent to a 2-for-1 stock split; it also raised the lower end of its 2026 capital expenditure forecast, further increasing its bet on artificial intelligence.

The earnings report showed that Meta's third-quarter revenue hit a record high of $64 billion, above analysts' expectation of $63.3 billion; GAAP earnings per share were $3.83, above the expected $3.56. Excluding legal costs, earnings per share would have been $7.40. In the same period last year, the company's earnings per share were $1.05 and revenue was $51.2 billion.

Regarding the stock split, Meta said shareholders will receive one new share for each existing share they hold, and each holder of Meta Class A stock will receive one non-voting Class C share. The company said the new shares will be used to raise capital, for employee compensation and for potential acquisitions. The move will allow Meta to ensure that CEO Mark Zuckerberg retains overall control of the company while continuing to fund its AI buildout.

On capital expenditure, Meta said 2026 capital expenditure is expected to be $135 billion to $145 billion, an increase from the low end of the previous range of $130 billion to $145 billion. These moves show that Meta is confident its artificial intelligence investment will pay off. Zuckerberg has struggled to persuade investors to accept the company's ever-increasing massive spending on its big bet on AI, but Meta's technology has made progress in recent months.

As of the close of the New York market on Wednesday, Meta's stock had risen about 6% this year; after the earnings release, the stock rose about 3.18% in after-hours trading. news_keyword_pub,stock, iframe below the main text iframe below the main text General statement General statement QR code at the end start QR code at the end start

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