Meta Platforms, Inc. — Q3 2026 Form 10-Q
Reporting period: Quarter and nine months ended September 30, 2026. Amounts are U.S. dollars; financial statement figures are in billions unless otherwise indicated. The filing describes a subsequent-event judgment dated October 21, 2026, after the quarter-end.
Business context and results
Meta reports Family of Apps (FoA)—Facebook, Instagram, Messenger, WhatsApp and other services—and Reality Labs (RL). Advertising generated $63.06 billion, or nearly all Q3 revenue.
| Metric | Q3 2026 | Q3 2025 | 9M 2026 | 9M 2025 |
|---|---|---|---|---|
| Revenue | $64.60B | $51.24B | $181.71B | $141.07B |
| Operating income | $12.99B | $20.54B | $54.64B | $58.53B |
| Operating margin | 20% | 40% | 30% | 41% |
| Net income | $9.86B | $2.71B | $52.48B | $37.69B |
| Diluted EPS | $3.83 | $1.05 | $20.44 | $14.62 |
Financial position, cash flow and capital needs
- Liquidity: Cash, cash equivalents and marketable securities totaled $82.45B at September 30. Current assets were $119.90B and current liabilities $63.01B. Of restricted cash equivalents, $10.80B was held in escrow and unavailable for general corporate use, with release expected in 2028–2030.
- Cash flow: Nine-month operating cash flow was $96.87B, versus $79.59B a year earlier. Investing cash outflow was $114.31B. Purchases of property and equipment were $83.06B; capital expenditures including finance-lease principal payments were $85.82B.
- Debt: Long-term debt carrying value was $80.92B, including $2.75B classified as current; total notes outstanding at face value were $84.00B. Meta issued $25.00B of notes in May 2026.
- Infrastructure commitments: Uncommenced lease obligations were approximately $355.73B. Non-cancelable contractual commitments totaled $454.52B, with approximately $45.85B due in 2026 and $121.41B in 2027. These are separate disclosed categories; the filing does not establish that they are additive.
- Capital returns: Meta paid $4.06B in dividends and dividend equivalents during the first nine months and made no share repurchases. $25.03B remained authorized for repurchases.
Material changes versus comparable periods
- Q3 revenue rose 26%; advertising revenue also rose 26%. Ad impressions increased 10% and average price per ad increased 14%. Nine-month revenue increased 29%.
- Q3 operating income fell 37%, and operating margin declined to 20% from 40%, as total costs and expenses rose 68%. Management attributed the increase chiefly to legal charges, infrastructure spending and third-party AI token costs.
- Q3 general and administrative expense was $14.86B versus $3.51B, including a $9.89B charge related to the multistate attorneys general agreement. Nine-month legal-related charges for that agreement were $11.89B.
- Q3 net income and EPS increased year over year despite lower operating income, primarily reflecting a much lower tax provision than in Q3 2025. The nine-month effective tax rate was 2%, including an $8.03B discrete tax benefit in Q1 2026; Q3 2026’s effective rate was 24%.
- Property and equipment, net, increased to $253.22B from $176.40B at year-end 2025. Nine-month property and equipment purchases increased to $83.06B from $48.31B.
- FoA Q3 operating income fell 31% to $17.12B. RL revenue was $443M and RL operating loss was $4.13B; the nine-month RL operating loss was $12.78B.
Outlook, management commentary and risks
- Management expects 2026 capital expenditures of approximately $135B–$145B, primarily to support AI initiatives and the core business. It expects full-year 2026 RL operating losses of approximately $18B–$19B and a Q4 2026 effective tax rate of 15%–17%. The filing provides no specific revenue or EPS guidance.
- Management says AI infrastructure investment is increasing and expects further investment. It also reports average Family daily active people of 3.64B in September 2026, up 3% year over year, and average revenue per person of $17.72, up 23%.
- The teen mental health and social media agreement provides for payments of up to approximately $18.59B and product changes for U.S. users under 18. Approximately $5.3B of payments remained contingent and was not accrued at September 30; additional expense may follow if the stated conditions are met.
- Subsequent legal development: The filing says that on October 21, 2026, a New Mexico court imposed a $25B civil penalty, with 15% post-judgment interest, following a September jury verdict. Meta says it accrued a loss contingency, intends to appeal and may need to post a bond or other collateral. The court had reserved ruling on injunctive relief.
- Other significant exposures include privacy, competition, youth-safety, content and AI-related litigation and regulation; potential changes to products or advertising practices; tax disputes; and substantial infrastructure, energy and cloud-capacity requirements. Meta cautions that outcomes and potential losses can be uncertain and materially affect results.
- Meta reported disclosure controls and procedures effective at September 30, 2026, and no material change in internal control over financial reporting during the quarter.
Important facts for investors to verify
- Track the status, appeal, accrual and potential cash or collateral effects of the New Mexico $25B order, and distinguish this post-quarter development from Q3-period results.
- Confirm the conditions and timing of the approximately $5.3B contingent portion of the multistate agreement and the implementation costs of required product changes.
- Assess whether planned AI-related capital spending, contractual commitments and long-term lease obligations remain supportable by operating cash flow; note the $10.80B escrow restriction.
- Monitor advertising growth, pricing and impression trends alongside user engagement, lower Reels monetization and regulatory or platform changes affecting ad targeting and measurement.
- Review the tax-rate drivers, unresolved IRS transfer-pricing matters and the $20.82B of gross unrecognized tax benefits disclosed at quarter-end.
- Review the October 2026 charter amendment and planned Class C stock dividend, including its expected January 19, 2027 effective date, voting rights and potential dilution from future issuance.