Meta Reports Record 3Q Earnings

Meta Platforms reported record third-quarter revenue of $64.6 billion and said it will create a new class of nonvoting shares to help fund its artificial-intelligence investments while preserving founder Mark Zuckerberg’s voting control.⁠

The company said revenue rose 26% from a year earlier and topped analysts’ expectations. Net income fell to $9.8 billion, well below the roughly $17.2 billion analysts had forecast, primarily because of a $9.9 billion legal charge tied to the settlement of social-media harm lawsuits. Shares rose about 4% in after-hours trading.⁠

For the current quarter, Meta projected revenue of $73 billion to $76 billion, with the high end above Wall Street estimates. It also raised the low end of its full-year capital-expenditure outlook to $135 billion from $130 billion; the high end remains $145 billion. Chief Financial Officer Susan Li said the company expects to “continue investing aggressively” in both its core business and AI efforts, though she gave no 2027 capex figure.⁠

Mark Zuckerberg

To support that spending, Meta will issue a new class of nonvoting common stock as a dividend to holders of its existing common and supervoting shares. The distribution, effective Jan. 19, 2027, functions as a 2-for-1 stock split. It will not change Zuckerberg’s voting control or the voting power of other shareholders, the company said.⁠

In a regulatory filing, Meta disclosed that Zuckerberg would be able to sell 20% of his new nonvoting shares immediately. The company said this could help him address a potential California wealth tax on the upcoming ballot and avoid a forced reduction in his voting stake. It noted that he had discussed the possibility of relocating if the tax passed, while also stating that he has committed to living in the same state as Meta’s headquarters for at least eight years, barring unforeseen circumstances.⁠News.

Meta’s free cash flow turned negative for the first time since it became a public company, at $2.1 billion. That was better than the roughly $9.4 billion outflow analysts had expected.⁠News.

The results and capital-raising plan come as investors have periodically questioned the scale of Zuckerberg’s AI spending and pressed for clearer near-term returns on the investments.