10-QPeriod: Q2 FY2026

Meta Platforms, Inc. Quarterly Report for Q2 Ended Jun 30, 2026

Filed July 30, 2026For Securities:META

Summary

Meta Platforms, Inc. reported strong revenue growth of 28% year-over-year for the second quarter of 2026, reaching $60.8 billion, primarily driven by advertising. Despite this revenue increase, income from operations saw an 8% decrease due to significant investments in AI, infrastructure, employee compensation, and legal-related costs. The company continues to heavily invest in its Family of Apps (FoA) segment, which showed robust revenue growth, while the Reality Labs (RL) segment reported an operating loss, albeit with a slight improvement year-over-year. Meta's financial position remains strong with substantial cash and marketable securities, but also carries a significant amount of long-term debt and future lease obligations. Key investor takeaways include Meta's continued advertising revenue momentum, fueled by both increased ad impressions and average ad prices. However, the significant rise in R&D and cost of revenue, largely attributed to AI infrastructure and talent, is a critical factor impacting profitability. Investors should closely monitor the impact of ongoing regulatory scrutiny and potential litigation on future operations and financial performance, particularly concerning privacy, competition, and content moderation.

Key Highlights

  • 1Revenue increased by 28% year-over-year to $60.8 billion, driven by advertising.
  • 2Income from operations decreased by 8% year-over-year to $18.78 billion due to increased costs and expenses.
  • 3Family of Apps (FoA) revenue grew 28%, while Reality Labs (RL) revenue grew 16%.
  • 4Research and development expenses increased significantly by 67% year-over-year, largely due to AI investments and infrastructure costs.
  • 5Total costs and expenses increased by 55% year-over-year.
  • 6Cash, cash equivalents, and marketable securities stood at $90.26 billion.
  • 7Long-term debt increased to $83.66 billion, with new notes issued in May 2026.

Frequently Asked Questions

Meta's primary revenue driver continues to be advertising. The company reported a 28% increase in total revenue, largely attributable to a 27% rise in advertising revenue, fueled by an increase in ad impressions delivered and a rise in the average price per ad.

The decrease in operating income is primarily due to significant increases in costs and expenses. These include higher employee compensation (including severance expenses), substantial investments in infrastructure for data centers and technical services, third-party cloud services, increased legal-related costs, and expenses related to third-party AI tokens.

The Reality Labs (RL) segment continues to operate at a loss, reporting an operating loss of $4.619 billion for the quarter. While RL revenue increased by 16% year-over-year, driven by higher sales of AI glasses, the segment's losses remain a significant factor impacting overall profitability. The company expects RL operating losses for the full year 2026 to remain similar to 2025.

Meta reported capital expenditures of $31.08 billion for the three months ended June 30, 2026. The company's long-term debt increased to $83.66 billion, reflecting new senior unsecured notes issued in May 2026. Meta's cash, cash equivalents, and marketable securities remain substantial at $90.26 billion, providing significant liquidity.