Meta revenue rose 26% to $64.6 billion, but a legal charge cut operating income 37%
Revenue rose 26.1% to $64.6 billion, while operating income fell 36.8% to $13.0 billion after a $9.89 billion legal charge. Capital spending of $33.9 billion left free cash flow negative.
Revenue
$64.6B
↑ 26.1% vs Q3 FY2025
Operating income
$13.0B
↓ 36.8% vs Q3 FY2025
Net income
$9.9B
↑ 264% vs Q3 FY2025
Capital spending
$33.9B
80.3% vs Q3 FY2025
Free cash flow
−$1.2B
↓ $12.3B vs $11.2B in Q3 FY2025
Meta's revenue rose 26.1% to $64.6 billion in the third quarter of 2026. Operating income fell 36.8% to $13.0 billion, because costs and expenses include a $9.89 billion charge for an agreement with state attorneys general. Capital spending of $33.9 billion was larger than operating cash flow of $32.8 billion.
Advertising drove the rise in revenue
Revenue grew 26.1% from $51.2 billion in the third quarter of 2025. Meta said advertising revenue increased $12.98 billion, due to more ad impressions delivered and a higher average price per ad. Ad impressions increased 10% and the average price per ad increased 14%, both from a year earlier. Revenue for the first nine months of the year was $181.7 billion, up 28.8% from the same period of 2025.
The legal charge and higher costs cut the operating margin
Operating income fell 36.8% to $13.0 billion, and the operating margin was 20.1%, down 20.0 points from 40.1% a year earlier. The second quarter of 2026 had a margin of 30.9%. In its 10-Q, Meta said general and administrative expenses rose mostly because of legal costs, including charges of $9.89 billion for the August 2026 agreement with state attorneys general in the quarter. Adding that charge back, operating income would have been $22.9 billion, a margin of 35.4%.
Other costs also grew faster than revenue. Research and development rose 32.4% to $20.1 billion. Cost of revenue, which Meta ties to data-center and cloud infrastructure, rose 45.2%, so gross margin was 79.3%, against 82.0% a year earlier.
Net income compares with a year of unusual taxes
Net income was $9.9 billion and diluted earnings per share were $3.83, against $2.7 billion and $1.05 in the third quarter of 2025. The year-earlier figure was low because the provision for income taxes was $19.0 billion, 87.5% of pretax income. Meta said that came mostly from the effects of the One Big Beautiful Bill Act, enacted in that quarter. This quarter's provision was $3.1 billion, a rate of 24.2%.
Capital spending exceeded operating cash flow
Cash from operations rose 9.3% to $32.8 billion. Cash spent on property and equipment rose 80.3% to $33.9 billion. Free cash flow, which is the first minus the second, was negative $1.2 billion, after $11.2 billion a year earlier. Meta's own release reports free cash flow of negative $2.12 billion, because it also deducts principal payments on finance leases.
Cash and marketable securities were $82.4 billion at September 30, 2026. Debt was $83.7 billion, up from $28.8 billion a year earlier. Meta paid $1.4 billion in dividends and bought back no shares in the quarter, after $3.3 billion of buybacks in the third quarter of 2025.
Capital spending is cash paid for property and equipment, and free cash flow is cash from operations minus that amount. Meta's own definition also deducts principal payments on finance leases. Diluted share counts are blank for some quarters in the structured data.
Sources: Form 10-Q (SEC EDGAR) · Form 10-Q filing index · EDGAR company facts for Meta · Meta third quarter 2026 earnings release (Exhibit 99.1). More figures for Meta are on its company page.
Twelve quarters of figures
| Quarter | Q4 '23 | Q1 '24 | Q2 '24 | Q3 '24 | Q4 '24 | Q1 '25 | Q2 '25 | Q3 '25 | Q4 '25 | Q1 '26 | Q2 '26 | Q3 '26 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $40.1B | $36.5B | $39.1B | $40.6B | $48.4B | $42.3B | $47.5B | $51.2B | $59.9B | $56.3B | $60.8B | $64.6B |
| Revenue growth | 24.7% | 27.3% | 22.1% | 18.9% | 20.6% | 16.1% | 21.6% | 26.3% | 23.8% | 33.1% | 28.0% | 26.1% |
| Gross margin | 80.8% | 81.8% | 81.3% | 81.8% | 81.7% | 82.1% | 82.1% | 82.0% | 81.8% | 81.9% | 81.4% | 79.3% |
| Operating margin | 40.9% | 37.9% | 38.0% | 42.8% | 48.3% | 41.5% | 43.0% | 40.1% | 41.3% | 40.6% | 30.9% | 20.1% |
| Net income | $14.0B | $12.4B | $13.5B | $15.7B | $20.8B | $16.6B | $18.3B | $2.7B | $22.8B | $26.8B | $15.8B | $9.9B |
| Diluted EPS | $5.31 | $4.71 | $5.16 | $6.03 | $7.98 | $6.43 | $7.14 | $1.05 | $8.87 | $10.44 | $6.18 | $3.83 |
| Cash from operations | $19.4B | $19.2B | $19.4B | $24.7B | $28.0B | $24.0B | $25.6B | $30.0B | $36.2B | $32.2B | $31.9B | $32.8B |
| Capital expenditure | $7.6B | $6.4B | $8.2B | $8.3B | $14.4B | $12.9B | $16.5B | $18.8B | $21.4B | $19.0B | $30.1B | $33.9B |
| Free cash flow | $11.8B | $12.8B | $11.2B | $16.5B | $13.6B | $11.1B | $9.0B | $11.2B | $14.8B | $13.2B | $1.7B | −$1.2B |
| Dividends and buybacks | $5.9B | $16.3B | $7.6B | $10.1B | $1.3B | $14.1B | $11.5B | $4.7B | $1.3B | $1.3B | $1.4B | $1.4B |
This story describes figures the company has published. It is for information only and is not investment advice or a recommendation to buy, sell or hold any security. Check the original filings before relying on any figure. Stoqly is not affiliated with the SEC or Meta Platforms.
