Meta

Internet Content & Information • Communication Services • Menlo Park, CA, United States • META (NMS)

650 543 4800 1 Meta Way, Menlo Park, CA 94025, United States

Quarter: Q3 2025 Reported: July 30, 2025 Sentiment: Positive

Meta Platforms, Inc. engages in the development of products that enable people to connect and share with friends and family through mobile devices, personal computers, virtual reality and mixed reality headsets, augmented reality, and wearables worldwide. It operates through two segments, Family of Apps (FoA) and Reality Labs (RL). The FoA segment offers Facebook, which enables people to build community through feed, reels, stories, groups, marketplace, and other; Instagram that brings people closer through instagram feed, stories, reels, live, and messaging; Messenger, a messaging application for people to connect with friends, family, communities, and businesses across platforms and devices through text, audio, and video calls; Threads, an application for text-based updates and public conversations; and WhatsApp, a messaging application that is used by people and businesses to communicate and transact in a private way. The RL segment provides virtual, augmented, and mixed reality related products comprising consumer hardware, software, and content that help people feel connected, anytime, and anywhere. The company was formerly known as Facebook, Inc. and changed its name to Meta Platforms, Inc. in October 2021. The company was incorporated in 2004 and is headquartered in Menlo Park, California.

Analysis Summary

Meta's Q2 2025 performance showcased strong growth across its core segments. The Family of Apps (FoA) segment, encompassing Facebook, Instagram, Messenger, and WhatsApp, generated $47.15 billion in revenue, representing a 22% increase year-over-year. This was primarily driven by an 11% rise in ad impressions and a 9% increase in the average price per ad, alongside a 6% year-over-year growth in Family Daily Active People (DAP) to 3.48 billion. The Reality Labs (RL) segment, focused on virtual and augmented reality, contributed $370 million in revenue, a modest 5% increase from the prior year.

Profitability metrics demonstrated significant improvement, with income from operations soaring 38% to $20.44 billion, leading to an operating margin of 43%, up from 38% in Q2 2024. Net income increased 36% to $18.34 billion, and diluted EPS rose 38% to $7.14. Total costs and expenses grew 12% to $27.07 billion, reflecting ongoing investments. The company reported robust cash flow from operating activities of $25.56 billion, resulting in free cash flow of $8.55 billion for the quarter. Headcount increased 7% year-over-year to 75,945.

CEO Mark Zuckerberg expressed excitement about building "personal superintelligence for everyone in the world," underscoring Meta's strategic focus on artificial intelligence. The company continued its capital return program, executing $9.76 billion in share repurchases and distributing $1.33 billion in dividends and dividend equivalents during the quarter. These actions reflect confidence in future performance and a commitment to shareholder returns amidst significant technological investments.

For Q3 2025, Meta projects total revenue between $47.5 billion and $50.5 billion. Full-year 2025 total expenses are expected to be in the range of $114 billion to $118 billion, with capital expenditures guided between $66 billion and $72 billion, marking a substantial increase for AI infrastructure. Management warned of even higher expense and CapEx growth in 2026 due to continued infrastructure scaling and talent acquisition. Furthermore, the company highlighted potential negative impacts on European revenue from ongoing regulatory scrutiny, particularly regarding the Digital Markets Act (DMA) and its Less Personalized Ads offering.

Key Highlights

• Q2 2025 Revenue increased 22% YoY to $47.52 billion.
• Diluted EPS surged 38% YoY to $7.14.
• Operating income grew 38% YoY to $20.44 billion, with operating margin at 43%.
• Family Daily Active People (DAP) reached 3.48 billion, up 6% YoY.
• Ad impressions increased 11% YoY, and average price per ad rose 9% YoY.
• Q3 2025 revenue guidance set at $47.5 billion - $50.5 billion.
• Significant capital expenditures of $66 billion - $72 billion guided for FY2025, primarily for AI infrastructure.

Financial Metrics

eps

7.14

YoY: 38%

revenue

47.52 billion

YoY: 22%

guidance

net income

18.34 billion

YoY: 36%

Stock Performance (90 Days)

Data through Dec 29, 2025

Layoff Events

Earnings Calls

Positive Signals

• Strong revenue and EPS growth exceeding prior year figures.
• Increased ad impressions and average price per ad indicating robust advertising business.
• Significant investment in AI infrastructure for future growth.
• Improved operating margin and healthy free cash flow.
• Ongoing share repurchases and dividend payments.

Risks & Concerns

— Substantial increase in capital expenditures and future expense growth, particularly in 2026.
— Increasing legal and regulatory headwinds in the EU, potentially impacting European revenue.
— Dependency on data signals and third-party policies that are not controlled by Meta.
— Competition in the social media and AI space.
— Uncertainty regarding the implementation and impact of new U.S. tax law.