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Meta Earnings Impact
Meta Platforms (NASDAQ: META) experienced a 6% drop in stock price following its third-quarter earnings report released on Wednesday. This decline was attributed to investors reacting negatively to the company’s plans for increased capital expenditures, now forecasted to rise from $66 billion to between $70 billion and $72 billion for 2026, alongside a significant one-time non-cash charge of $15.9 billion associated with a deferred tax asset adjustment.
Financial Performance
Despite the stock drop, Meta reported a revenue increase of 26% year-over-year, totaling $51.2 billion, which surpassed analyst expectations of $49.4 billion. The company also noted significant growth in its advertising business, with active users across its family of apps rising 8% to 3.54 billion. Operating margin slightly decreased to 40% as investments in AI ramped up.
Future Outlook
CEO Mark Zuckerberg emphasized the company’s commitment to advancing AI technologies, stating that the capital expenditures would support superintelligence initiatives. While Meta incurred an operating loss of $13.2 billion from its Reality Labs division this year, the company generated over five times that in operating profit from its core apps.
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