Meta CEO Mark Zuckerberg holds a smartphone as he makes a keynote speech at the Meta Connect annual event, at the company's headquarters in Menlo Park, California, on Sept. 25, 2024.
Manuel Orbegozo | Reuters
Meta shares jumped more than 10% after the company reported second-quarter earnings on Wednesday that beat on revenue. Here's how the company did, compared with estimates from analysts polled by LSEG:
- Earnings per share: $7.14 vs. $5.92 expected
- Revenue: $47.52 billion vs. $44.80 billion expected
Meta's second quarter sales grew 22% year over year, which was the same growth rate as a year ago.
The company's advertising revenue for the second quarter came in at $46.56 billion, ahead of Wall Street projections of $43.97 billion. On a call Wednesday with analysts, CEO Mark Zuckerberg said Meta's artificial intelligence technology unlocked "greater efficiency and gains across our ad system."
Meta said third-quarter sales will come in the range between $47.5 billion and $50.5 billion, ahead of Wall Street estimates of $46.14 billion.
The company said capital expenditures will come in between $66 billion and $72 billion, raising the low end of the company's previous estimate of between $64 billion and $72 billion.
Meta said compensation related to hiring will be "the second-largest driver of growth," and that "these factors will result in a 2026 year-over-year expense growth rate that is above the 2025 expense growth."
Reality Labs, Meta's unit tasked with developing virtual reality and augmented reality technologies, recorded an operating loss of $4.53 billion on $370 million in sales during the second quarter. The loss was less than Wall Street estimates, but so were the expected sales.
Daily active people for Meta's family of apps grew to 3.48 billion in the second quarter, ahead of analyst estimates of 3.45 billion. That's up from 3.43 billion in the previous quarter.
Meta's total costs and expenses for the second quarter were $27.08 billion, which was a 12% year-over-year increase.
The company kicked off its AI hiring bonanza in June when it invested $14.3 billion into Scale AI, landing the data-annotating startup's CEO Alexandr Wang to co-lead the new Meta Superintelligence Labs as chief AI officer. CEO Mark Zuckerberg undertook the AI strategy overhaul to help Meta regain momentum after lukewarm developer response to its Llama 4 AI model, CNBC reported Tuesday.
Meta finance chief Susan Li discussed the company's Scale AI and related AI spending during the earnings call, saying "we also made $15.1 billion in nonmarketable equity investments in the second quarter, which includes our minority investment in Scale AI, along with other investment activities."
Zuckerberg provided an outline for his vision of "personal superintelligence" in a letter he published Wednesday morning. Zuckerberg did not list any particular product or app that exemplifies his vision, but said the cutting-edge tech should be used for "personal empowerment" over automation and efficiency.
The Meta CEO expanded on the company's AI investments during the earnings call, saying that "super intelligence empowers people to be more creative, develop culture and communities, connect with each other and lead more fulfilling lives."
"Over the last few months, we've begun to see glimpses of our AI systems improving themselves, and the improvement is slow for now, but undeniable," Zuckerberg said. "Developing super intelligence, which we define as AI that surpasses human intelligence in every way we think, is now in sight."
The social media company said its total expenses for 2025 will fall in the range between $114 billion and $118 billion, which raises the low end of its prior outlook of between $113 billion and $118 billion.
Meta's net income in the second quarter rose 36% year over year to $18.34 billion.
The company did not provide an outlook for fourth-quarter sales, but said it expects the year-over-year growth rate in that quarter "to be slower than the third quarter as we lap a period of stronger growth in the fourth quarter of 2024.
Google posted strong quarterly earnings results last week that beat on the top and bottom lines.
Amazon and Reddit will report their second-quarter earnings on Thursday.
Snap will report its latest quarterly earnings on Tuesday followed by Pinterest, which will report its financials on Thursday.
This is breaking news. Please check back for updates.
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