Meta reported mixed financial results for the third quarter of 2025. The company brought in record quarterly revenue but reported a major tax bill that dampened earnings per share, the company announced on Wednesday. The financial results come as Meta ends a multibillion-dollar hiring spree focused on artificial intelligence talent.
The tech giant earned $51.24bn in quarterly revenue, beating Wall Street’s expectations and the company’s own projections for third-quarter sales. However, it reported earnings per share (EPS) of $1.05, far below Wall Street expectations of $6.70 in EPS. The major drop was due to a one-time non-cash income tax charge of $15.93bn. The EPS would have been $7.25 without this one-time charge, the company said.
The report, and the scheduled investor call, gives investors another opportunity to find out whether the company’s lavish spending on AI infrastructure is justified. The company projected full-year total expenses would be between $116 to $118bn, upping the lower end of the range from $114bn. The company also expects 2025 capital expenditures to be between $70 and $72bn, up from a previously projected range of $66 and $72bn. Meta said its fourth-quarter revenue would likely fall somewhere between $56 and $59bn.
“We had a strong quarter for our business and our community,” said Mark Zuckerberg, Meta’s founder and CEO. “Meta Superintelligence Labs is off to a great start and we continue to lead the industry in AI glasses. If we deliver even a fraction of the opportunity ahead, then the next few years will be the most exciting period in our history.”
Jesse Cohen, senior analyst at Investing.com, said the latest report reveals “the growing tension between the company’s massive AI infrastructure investments and investor expectations for near-term returns”.
It’s the first financial update since Meta said it planned to lay off 600 staffers from its AI unit – the same unit the company went on a spending and hiring spree to restructure and fill with the top AI talent from other companies. The company said the layoffs were an effort to reduce the bloat within the company’s “super-intelligence” unit and brought the number of employees there down to just under 3,000.
Investors will also likely be hearing more about the company’s latest move to fund and support the development of its network of data centers. Earlier this month, the company announced a new joint venture with Blue Owl Capital that would help the firms build and finance the new $27bn Hyperion data center campus in Louisiana, the biggest Meta is involved in developing.
The company’s stock has been on a steady rise over the past six months. Its previous two earnings reports have beaten Wall Street expectations. The wider US stock market likewise reached record highs the week.
Meta also launched its new Ray-Ban Display glasses last month, which feature a screen embedded in the lenses, and analysts are eager to hear sales figures. Meta’s original camera glasses, simply dubbed Meta Ray-Bans, proved to be a popular gadget. Both types of glasses have already prompted privacy concerns. While Meta has designed the glasses not to work if a light that notifies people that the glasses are recording is covered, a $60 modification can disable the light, 404 Media reported.
“I suspect these glasses, in particular, will predominantly appeal to early ‘tech-curious’ adopters, and that scheduled demos will far outpace sales,” said Mike Proulx, Forrester VP, research director.
On the advertising side, Meta lost its accreditation from the Media Rating Council, a non-profit that sets industry wide standards for brand safety, after the company decided to pull out of the organization’s annual audits. The accreditation signals to advertisers that the content on the platform that their ads may appear next to would not be harmful to their brand. Meta received the accreditation just four months before it was stripped.
Analysts were optimistic that the loss of accreditation would not ultimately hurt Meta’s ability to attract advertisers.
“While this may raise eyebrows among advertisers, it won’t deter them from investing in Meta due to its sheer audience reach and brand reliance,” Proulx said. “Brands will overlook potential brand safety risks as long as their Meta media investments continue to perform.”
Source: US Politics - theguardian.com
