A company behind many of the world's most-used apps—Facebook, Instagram, Messenger, WhatsApp, and Threads—that makes nearly all its money from advertising, and also builds virtual-reality headsets, AI glasses, and its Meta AI assistant. It began in 2004 as a Harvard dorm project called "TheFacebook," launched by Mark Zuckerberg and his roommates, and in 2021 the parent company renamed itself Meta to signal its focus on building a connected digital "metaverse," keeping the Facebook app's name unchanged.
Operating income fell 8% as costs rose 55%, even as revenue grew 28% to $60.8B.
Costs are now growing nearly twice as fast as . Revenue rose 28% to $60.8 billion on a 12% increase in ad prices, but fell 8% to $18.8 billion as total expenses rose 55%, driven by a 67% rise in R&D and a doubling of legal costs. The core advertising engine is still accelerating, but the price of building it is rising faster.
Key takeaways
fell 8% to $18.8 billion even as rose 28%, because total costs and expenses rose 55% to $42.0 billion.
Advertising rose 27% to $59.4 billion, with a 14% increase in ad impressions and a 12% increase in average price per ad — the tenth consecutive quarter of price gains.
Research and development expense rose 67% to $21.7 billion, and general and administrative expense more than doubled to $5.6 billion, including $2.4 billion in legal charges.
Section summaries
Management's Discussion and Analysis
Total revenue rose 28% to $60.80B on ad growth, but operating income fell 8% to $18.78B as costs surged 55%.
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Advertising grew 27% to $59.36B, driven by a 14% increase in ad impressions and a 12% rise in average price per ad.
posted a $4.6 billion operating loss on of $431 million, as higher AI glasses sales were outweighed by technology development costs.
reached $31.1 billion in the quarter, and the company raised its full-year 2026 capex to $130–$145 billion.
rose to $83.7 billion after a $24.9 billion debt issuance in May 2026, while cash and equivalents fell 34% from the prior quarter to $15.5 billion.
What changed
The 12% increase in average price per ad accelerated from 9% in Q2 2025 and 12% in Q1 2026, confirming a tenth consecutive quarter of price gains.
The $4.6 billion operating loss widened from $4.0 billion in Q1 2026, reversing the narrowing trend seen earlier in the year.
Full-year 2026 was raised to $130–$145 billion, up from the approximately $125–$145 billion indicated in Q1 2026.
The FTC antitrust suit seeking divestiture of Instagram and WhatsApp was dismissed in Meta's favor in November 2025, but the FTC has appealed, keeping the risk alive.
What to watch
Q3 2026 average ad price against the 12% Q2 increase to confirm an eleventh quarter of price gains.
Full-year 2026 against the $130–$145 billion guide as AI infrastructure spend scales.
operating loss in Q3 2026 against the $4.6 billion Q2 figure.
Outcome of the FTC's appeal of the November 2025 dismissal of its antitrust suit.
declined 6% to $23.39B as higher employee compensation, infrastructure, legal, and AI token costs outweighed gains.
rose 16% to $431M on higher sales, but the posted a $4.62B operating loss, slightly wider than last year.
Total costs and expenses jumped 55% to $42.03B, with R&D up 67% to $21.66B and G&A more than doubling to $5.61B, including $2.40B in legal charges.
were $31.08B in Q2, and the company expects full-year 2026 capex of $130B–$145B to support AI and core infrastructure.
Cash and marketable securities stood at $90.26B, while rose to $83.66B after a $24.91B debt issuance in May 2026.
Quantitative and Qualitative Disclosures About Market Risk
There have been no material changes to our market risk exposures during the six months ended June 30, 2026. For quantitative and qualitative disclosures about market risk, refer to Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk, from our Annual Repo…
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There have been no material changes to our market risk exposures during the six months ended June 30, 2026. For quantitative and qualitative disclosures about market risk, refer to Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk, from our Annual Report on Form 10-K for the year ended December 31, 2025.
Meta faces numerous material legal proceedings globally, with potential aggregate exposure up to hundreds of billions of dollars.
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In privacy matters, a $725M consumer class settlement became final in May 2025, and the FTC seeks to modify a 2020 to impose new restrictions on minors' data and product launches.
The IDPC fined Meta €1.2B over GDPR data transfer violations; Meta is appealing, and the IDPC is assessing the '' model's compliance.
In competition, the FTC's antitrust suit seeking divestiture of Instagram and WhatsApp was dismissed in Meta's favor in November 2025, but the FTC has appealed.
The European Commission fined Meta €798M for tying and €200M under the DMA for the '' model; both decisions are under appeal.
Youth-related litigation includes a $375M civil penalty verdict in New Mexico and a $6M award, with additional trials scheduled through 2027 and potential damages sought up to over a trillion dollars.
Other significant matters include securities class actions, AI copyright lawsuits where fair use was partially upheld, and DSA compliance proceedings with preliminary findings of infringement.
Meta faces material risks from regulatory actions, ad signal loss, AI investments, and competition that could significantly impact financial performance.
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Regulatory actions in Europe, including the DMA non-compliance decision on the '' model and potential invalidation of the EU-U.S. DPF, threaten Meta's ability to offer key products and target ads, risking material loss.
Loss of data signals from Apple's iOS changes and other platform restrictions continues to impair ad targeting and measurement, negatively impacting advertising and marketer budgets.
Significant and increasing investments in AI and , with Reality Labs reducing 2025 by ~$19.19 billion, may not yield expected returns, pressuring margins and cash flows.
Competition from TikTok and other platforms is reducing user engagement, particularly among younger demographics, while Meta's promotion of lower-monetizing products like may further pressure ad .
Litigation and regulatory scrutiny, including FTC proceedings alleging COPPA violations and youth-related lawsuits with adverse verdicts, could force costly business practice changes and substantial penalties.
Dependence on mobile operating systems and browser providers like Apple and Google creates ongoing risk of product degradation, preferential treatment of competitors, and further ad signal restrictions.