Meta Platforms reported a $9.89 billion legal charge that helped cut third-quarter operating income 37% to $12.99 billion, even as revenue rose and the company said it would continue investing in artificial intelligence (AI).
For the three months ended Sept. 30, revenue totaled $64.601 billion, up 26% from $51.242 billion a year earlier. Net income reached $9.860 billion, compared with $2.709 billion, while the income-tax provision fell to $3.141 billion from $18.954 billion.
Meta said operating income would have been $22.88 billion without the charge. Its calculation also put diluted earnings per share at $7.40 excluding the expense, compared with reported diluted earnings of $3.83. In August, Meta agreed to terms involving 52 attorneys general in litigation over teen mental health and social media; the company said the quarterly charge reflected that arrangement.
Meta also said 30% of payments under the agreement are conditional on TikTok and YouTube adopting specified protections for teenagers and making matching payments.
On Oct. 21, the New Mexico Department of Justice said a court had ordered Meta to pay $25 billion in civil penalties under the state’s Unfair Practices Act. The order followed a jury finding of 43,899,725 violations. The department said the case concerned Facebook’s conduct surrounding the Cambridge Analytica scandal. New Mexico pursued its privacy case independently and did not join the multistate teen mental-health agreement. The $25 billion order is separate from the teen mental-health agreement behind Meta’s quarterly charge.
Meta’s capital outlay for the quarter came to $34.91 billion when principal paid on finance leases was counted. The company projected 2026 capital expenditures of $135 billion to $145 billion and full-year expenses of $175 billion to $179 billion, including the legal charge. The company linked higher ad revenue to stronger engagement, content recommendations and ad monetization from AI, while saying newer AI projects may take longer to produce returns than investment in its core business. For the fourth quarter, Meta forecast revenue of $73 billion to $76 billion.
