Meta raises low-end of 2026 capex outlook, announces Class C stock plan to preserve founder-led control

By Reuters News


Overview

  • Social media giant's Q3 revenue grew 26% yr/yr, beating analyst expectations

  • Adjusted EPS for Q3 rose sharply, boosted by core business and excluding litigation charge

  • Company approved new Class C common stock and a one-time stock dividend


Outlook

  • Meta expects Q4 2026 revenue between $73 bln and $76 bln

  • Meta raises low-end of 2026 capex outlook to $135 billion-$145 billion from $130 billion-$145 billion to incorporate ~$9.9 billion legal charge

  • Meta expects 2026 Reality Labs losses to narrow to $18-19 bln


Result Drivers

  • ADVERTISING GROWTH - Higher ad impressions and a 14% increase in average price per ad drove revenue growth

  • AI INVESTMENTS - Co said AI investments boosted advertising revenue by improving engagement and monetization


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q3 Revenue

Beat

$64.60 bln

$63.37 bln (47 Analysts)

Q3 EPS

$3.83

Q3 Operating Margin

20%


Analyst Coverage

  • The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 56 "strong buy" or "buy", 6 "hold" and 1 "sell" or "strong sell"

  • The average consensus recommendation for the online services peer group is "buy"

  • Wall Street's median 12-month price target for Meta Platforms, Inc. is $815.00, about 17.4% above its October 20 closing price of $694.25

  • The stock recently traded at 21 times the next 12-month earnings vs. a P/E of 17 three months ago


Reuters Recommended Reads

  • Oct 21 - Meta ordered to pay $25 billion to New Mexico after jury finds company misled consumers about data privacy

  • Oct 19 - Nvidia-backed Nscale, Anthropic in talks for new $45 billion AI cloud deal, source says

  • Oct 19 - AI stocks bounce back after bruising selloff, CoreWeave gets Goldman upgrade


For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.


(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)

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