Meta Posts Strong Revenue Growth, But Earnings Slump Amid Tax Charge

Strategic Insights -

Meta Platforms Inc (NASDAQ:META) reported a stronger-than-expected revenue in the third quarter of 2025, driven by a 26% year-over-year increase to $51.24 billion. However, a massive one-time tax charge sent earnings per share tumbling, leading to a sharp decline in shares. The company's Family of Apps unit reported revenue of $50.77 billion, exceeding analysts' estimates, while its Reality Labs division narrowed its operating loss to $4.43 billion. Meta forecast a revenue range of $56 billion to $59 billion for the fourth quarter, above analysts' expectations. The company also announced significantly higher capital expenditures for 2026, driven by AI infrastructure expansion.

Key Takeaways:

  • Meta reported revenue of $51.24 billion in Q3 2025, up 26% year-over-year, exceeding analysts' estimate of $49.59 billion.
  • Excluding the one-time tax charge, earnings per share would have been $7.25, up 20% year-over-year.
  • The company's Family of Apps unit reported revenue of $50.77 billion, beating estimates of $49.04 billion.
  • Reality Labs division narrowed its operating loss to $4.43 billion, compared to analysts' expected loss of $5.16 billion.
  • Meta forecast Q4 revenue of $56 billion to $59 billion, above analysts' estimate of roughly $55.3 billion.
  • The company expects capital expenditures to be $70 billion to $72 billion for 2025, slightly higher than the previous range.
  • Meta flagged significantly higher CapEx and expenses for 2026, driven by AI infrastructure expansion.

Statistics:

  • Revenue: $51.24 billion (up 26% year-over-year)
  • Excluding one-time tax charge, EPS: $7.25 (up 20% year-over-year)
  • Daily active people: 3.54 billion (up 8% year-over-year)
  • Operating income: $20.54 billion (up 18% year-over-year)
  • Reality Labs operating loss: $4.43 billion (narrower than analyst estimate of $5.16 billion)
  • Capital expenditures for 2025: $70 billion to $72 billion (slightly higher than previous range)
  • Capital expenditures for 2026: higher, driven by AI infrastructure expansion
  • Shares fell 8.2% in after-hours trading to $689.60

Sources:

  • Meta Platforms Inc, "Meta Reports Third Quarter 2025 Financial Results", [Source](https://www.meta.com/investors/financials/)
  • Bloomberg, "Meta Stock Falls 8.2% After Earnings Miss Estimates", [Source](https://www.bloomberg.com/news/articles/2025-10-25/meta-stock-falls-8-2-after-earnings-miss-estimates)