Mark Zuckerberg, chief executive officer of Meta Platforms Inc., wears a pair of Meta Oakley Vanguard AI glasses during the Meta Connect event in Menlo Park, California, US, on Wednesday, Sept. 17, 2025.
David Paul Morris | Bloomberg | Getty Images
Meta reported fourth-quarter earnings on Wednesday that topped estimates and issued stronger-than-expected sales guidance. The stock popped as much as 10% in after-hours trading.
Here’s how the company did, compared with estimates from analysts polled by LSEG:
- Earnings per share: $8.88 vs. $8.23 estimated
- Revenue: $59.89 billion vs. $58.59 billion estimated
Meta said it expects first-quarter sales to come in the range of $53.5 billion to $56.5 billion, ahead of analyst estimates of $51.41 billion.
Finance chief Susan Li said that forecast was “really underpinned by the strong demand that we saw through the end of Q4 and continuing into the start of 2026.”
The company said fourth-quarter sales rose 24% year-over-year. The company said its advertising business generated revenue of $58.1 billion for the period. Advertising made up nearly 97% of the company’s overall revenue for the quarter.
Meta said that fourth-quarter daily active people came in at 3.58 billion, in line with Wall Street estimates.
The social media giant said it expects the total expenses for 2026 to come in between $162 billion through $169 billion.
Capital expenditures related to the company’s artificial intelligence push are expected to be in the range of $115 billion to $135 billion for 2026, ahead of analyst expectations of $110.7 billion for the year. It’s also nearly double how much Meta spent on capex in 2025, which came in at $72.2 billion, the company said on Wednesday.
Meta said the capex spending is due to “year-over-year growth driven by increased investment to support our Meta Superintelligence Labs efforts and core business.”
CEO Mark Zuckerberg said Meta will release its latest AI models “over the coming months.”
“I expect our first models will be good, but more importantly, we’ll show the rapid trajectory that we’re on,” he told analysts on a call Wednesday, “And then, I expect us to steadily push the frontier over the course of the year, as we continue to release new models.”
The company spent a large chunk of 2025 overhauling it AI unit, investing $14.3 billion in Scale AI as part of an effort to land the startup’s founder Alexandr Wang and several of his colleagues.
Wang oversees Meta’s top-tier TBD unit that is tasked with developing powerful AI models. The company set up TBD after its Llama 4 model launched to tepid response from developers last spring. Meta has been testing a new frontier model and Llama successor code-named Avocado, and plans to release it during the first half of the year, CNBC reported.
The company’s Reality Labs unit logged an operating loss of $6.02 billion while generating $955 million in sales for the quarter. Analysts were projecting Reality Labs to record an operating loss of $5.67 billion on $940.8 million in fourth-quarter sales.
Reality Labs now has nearly $80 billion in total operating losses since late 2020.
Earlier this month, Meta laid off more than 1,000 Reality Labs employees who worked on VR-related initiatives, including internal studios, as part of a shifting of resources to AI and related wearable devices, like the Ray-Ban Meta smart glasses.
Although Meta tech chief Andrew Bosworth told media outlets last week that Meta is not halting its VR efforts, the company’s outsized impact on that industry has chilled some developers and sparked fears of a VR winter, CNBC reported.
Meta on Wednesday said that it expects Reality Labs operating losses in 2026 to remain at similar levels to the year prior. Zuckerberg said he expects this year to be the peak of Reality labs’ losses, “as we start to gradually reduce our losses going forward.”
The company noted that regulatory and legal headwinds in the European Union and the U.S. respectively could “significantly impact our business and financial results.” Meta said that various high-profile social media trials commencing this year “may ultimately result in a material loss.”
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