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metaThe stock fell in after-hours trading on Wednesday after the tech giant reported strong third-quarter results but warned that its spending in 2026 will be significantly higher than this year.
Like its rivals, Meta Platform Inc. has been ramping up spending on artificial intelligence and has said its costs will rise sharply next year due to infrastructure costs and employee compensation, as it has hired AI experts at eye-popping compensation levels.
“Employee compensation costs will be the second largest contributor to growth as we recognize a full year of compensation for employees hired in 2025, particularly AI talent, and add technical talent in priority areas,” Meta said.
Menlo ParkCalifornia-based Meta Platform Inc. earned $2.71 billion, or $1.05 a share, in the July-September period. Excluding tax-related special expenses, the company would have earned $7.25. Revenue increased 26% to $51.42 billion from $40.59 billion.
Analysts, on average, were expecting earnings of $6.72 per share on revenue of $49.51 billion, according to analysts surveyed by FactSet Research.
Meta’s daily active user base on its apps — Facebookmessenger, whatsapp, Instagram And threads – averaged 3.54 billion for September, up 8% year-over-year.
For the current quarter, Meta is forecasting revenue between $56 billion and $59 billion. Analysts are estimating $57.36 billion for the October-December quarter.
Meta also cautioned that it faces a number of legal and regulatory issues in the US and EU that could hurt its profits.
“In the US, several trials involving youth are scheduled for 2026, and may ultimately result in material harm,” the company said.
In the US, Meta is facing an antitrust case that is now awaiting a judge’s decision and could force the company to break up WhatsApp and Instagram, startups Meta bought more than a decade ago that have since become social media powerhouses.
Meta shares fell $57.67, or 7.7%, to $694 in after-hours trading. The stock closed slightly higher at $751.67.