As Meta continues to enhance user experiences and monetise engagement effectively, it aims to deliver fresh content more quickly and serve relevant ads at the right time and place. The company also sees growth opportunities in selling computing capacity to external customers, Meta One, and APIs.
| Financial indicator | Q2 2025 (US$ million) | Q2 2026 (US$ million) | Percentage change |
| Revenue | 47,516 | 60,801 | +28.0% |
| Family of Apps | 47,146 | 60,370 | +28.0% |
| Reality Labs | 370 | 431 | +16.5% |
| Operating income | 20,441 | 18,775 | -8.2% |
| Net income | 18,337 | 15,848 | -13.6% |
Management sees opportunities in commercialising compute, developer APIs, and business agents for enterprise customers. Meta recently partnered with Blackrock to develop a data center in El Paso, Texas, though the vast majority of its compute remains allocated to internal workloads. To capture software and developer monetisation, Meta launched the Meta Model API, providing pay-as-you-go access to its Muse Spark multimodal reasoning models for agentic workflows. Further, Meta introduced Meta One, a subscription suite targeting businesses and creators that bundles management, cross-app AI features, and support tools.
Global average ad prices increased 12% year-on-year, driven by ad performance gains, an improved macroeconomic environment, and foreign exchange tailwinds. In Q2 2026, ad impressions grew 14%, supported by lower-monetising surfaces and regions, higher user engagement, and load optimisation across all regions. The annualised revenue run rate of advertising tools Advantage+ surpassed US$75 billion in Q2 2026. More than 9 million small businesses used at least one of Meta’s AI ad creative tools.
Capital expenditures (CapEx) during the quarter totalled US$31.1 billion, financed primarily by operating cash flow, followed by debt. During the quarter, Meta’s cash and marketable securities stood at US$90.3 billion while total debt amounted to US$83.7 billion. CapEx guidance in 2026 has been narrowed from the range of US$130 billion and US$145 billion to between US$125 billion and US$145 billion.
Revenue in Q3 2026 is expected to range between US$61 billion and US$64 billion, supported by strong and diversified spending across advertisers amid a projected 1% foreign exchange headwind. FY2026 operating income is expected to grow year-on-year, driven by ad performance investments and ad supply tailwinds from higher user engagement and ad load optimisations.
Family of Apps
More than 3.6 billion users engage with at least one of Meta’s Family of Apps daily. Advertising remained Meta’s dominant revenue source by contributing 98.3% of its Family of Apps revenue in Q2 2026. Family of Apps other revenue grew 73% year-on-year to surpass US$1 billion for the first time, driven primarily by WhatsApp paid messaging and subscriptions revenue.
Facebook and Instagram
There are over 2 billion Facebook daily active users. Users spent 9% more time watching videos on the app, with growth exceeding 10% in the U.S. and Canada, driven by ranking improvements. Ad clicks increased 8.3% while conversions grew 15.7%, driven by its ads ranking and sequence learning model.
The number of daily active users on Instagram exceeded 2 billion. The amount of time users spent on Instagram grew by double-digits year-on-year, driven by Feed improvements and Reels recommendations. New features like Instagram Instants have recently rolled out, while business agents are set to follow by the end of 2026.
Facebook and Instagram users can also tune their recommendations which resulted in over 80% retention among engaged users. Early LLM pilots for understanding user preferences also lifted Instagram app event conversions by 1%.
WhatsApp and Messenger
WhatsApp messaging reached a record high, remaining a primary hub for Meta AI usage. Meta Business Agents launched globally on WhatsApp and Messenger in Q2 2026, with early traction showing over 1 million businesses leveraging the feature weekly to engage customers or complete sales.
Threads and Meta AI
Threads remains fast-growing with monthly active users surpassing 500 million. As a result, more ads have since been introduced on newer surfaces like the platform. Meta AI has been rebuilt and integrated with Muse Spark, driving a 60% increase in daily active users.
Reality Labs
Despite higher year-on-year revenue, Reality Labs operating loss widened from US$4.5 billion in Q2 2025 to US$4.6 billion in Q2 2026. The segment recorded higher AI glasses sales, but lower Quest headset sales. Meta also collaborated with EssilorLuxottica to release Meta Glasses.
Key analyst questions
Meta received numerous external offers to purchase its compute at a premium. Management aims to strike a balance between selling compute for short-term profits and prioritising internal use cases that deliver longer-term compounding value. Supply constraints remain in the near term around 2026 and 2027 as the company sources capacity mainly through third-party cloud providers. Management believes near-term capacity holds higher value than long-term capacity due to these supply constraints.
Meta plans to monetise Meta Business Agents in the future, with a volume-based pricing model announced in July 2026 and a shift to a per-token basis effective August 2026 to cover both AI agent processing and message delivery.
Paid messaging growth is driven by a rising number of active businesses and scaling volume. Marketing messages remain the primary revenue driver for paid messaging growth. Growth is further supported by increasing utility and authentication message volumes in key markets like India and Brazil.
CFO Susan Li responded to an analyst the growth deceleration in the September quarter was due to a difficult quarter comparison. Q3 2025 impression growth accelerated due to engagement-related ranking improvements (mainly on Instagram Feed and Reels) and ad load optimisation (on Instagram Feed and Stories). Growth faced headwinds from the fully rolled-out impact of less personalised ad offerings in Europe.
The fifth perspective
As Meta’s Family of Apps remains deeply embedded in users’ daily lives, the social media giant is well positioned to remain relevant in the years ahead. The rise of personal AI agents could further strengthen user engagement, enhance content discovery, and create new monetisation opportunities across its platforms. With its strong financial performance, vast user base, and continued investment in AI and infrastructure, Meta shows few signs of slowing down, although investors should continue to monitor the significant spending and execution risks associated with these ambitions.
