Meta Q3 2026 Earnings: Revenue Jumps 26% as New Class C Stock Hits Shares

Meta Platforms shares fell sharply on Thursday, Oct. 22, 2026, even after the company beat Wall Street’s revenue forecast, as investors weighed heavy AI spending and a plan for a new class of non-voting stock. In its Meta Q3 2026 earnings report on Wednesday, the Facebook and Instagram parent posted $64.60 billion in revenue, up 26% from a year earlier, and said a new Class C share will arrive in January 2027.

Image: Aerial view of Meta’s Menlo Park, California, campus, used for illustration. Photo: Austin McKinley, via Wikimedia Commons (CC BY 3.0).

Meta Q3 2026 earnings by the numbers

Meta’s press release laid out a strong advertising quarter alongside a heavy legal charge and record spending:

• Revenue: $64.60 billion, up 26% year over year. Advertising brought in $63.06 billion.
• Net income: $9.86 billion, or $3.83 per diluted share.
• Legal charge: $9.89 billion tied to Meta’s August agreement with 52 state attorneys general over teen mental health and social media, a settlement that provides for payments of up to about $18.59 billion. Excluding the charge, Meta said diluted earnings would have been $7.40 a share.
• Operating margin: 20%, down from 40% a year earlier, with the legal charge included in costs.
• Users and ads: 3.64 billion daily active people across Meta’s apps, up 3%. Ad impressions rose 10% and the average price per ad rose 14%.
• Capital spending: $34.91 billion in the quarter, which pushed free cash flow to negative $2.12 billion.
• Headcount: 66,775 employees, down 15% from a year earlier.

“Our investments are paying off, the core business is strong, and we’re seeing velocity across the board,” founder and CEO Mark Zuckerberg said in the release, pointing to the launch of Muse and Muse Wonder, which Meta called its first frontier model.

The new Class C stock, explained

The bigger surprise was the share structure. Meta’s board approved a new class of publicly listed, non-voting Class C common stock, with an effective date of Jan. 19, 2027. Each holder of Class A or Class B stock will receive one Class C share for every share they own as a one-time stock dividend. Meta said it expects the price of its Class A stock to reflect a two-for-one split after the dividend is paid, and that the change will not alter anyone’s voting power.

Meta said the board acted on the unanimous recommendation of a special committee of independent directors. The stated reasons include creating shares for capital raising, employee compensation and potential acquisitions as AI investment needs grow, and ensuring Zuckerberg continues to lead the company. Meta also signed a Founder Alignment Agreement with Zuckerberg covering his sales of the new Class C shares and his service at the company. Record and payment dates will be set later, and Meta plans to list the Class C shares on Nasdaq.

In plain terms, Meta gains a listed share class it can issue to raise money, pay employees or fund deals without diluting the voting control Zuckerberg holds. Yahoo Finance described the move as a two-for-one stock split announcement.

Guidance: more spending ahead

Meta forecast fourth-quarter revenue of $73 billion to $76 billion. It raised its full-year 2026 expense outlook to $175 billion to $179 billion to absorb the legal charge, and narrowed its 2026 capital expenditure range to $135 billion to $145 billion, from $130 billion to $145 billion before. It said it expects to “continue investing aggressively” in 2027 and that AI investments by its superintelligence lab “will take longer to generate returns than those in our core business.”

The Reality Labs unit, which makes virtual and augmented reality hardware, lost $4.13 billion in the quarter. Meta now expects that unit to lose $18 billion to $19 billion in 2026 and about $15 billion next year as money shifts toward AI.

How the market reacted

Meta shares fell more than 7% on Thursday, according to CNBC’s midday movers list, even though revenue topped the LSEG consensus forecast of $63.37 billion. Yahoo Finance said Meta “tanked” as investors weighed the results and the stock split plan, while the Nasdaq Composite fell more than 2% as semiconductor stocks slid and oil prices climbed to a five-month high.

The reaction fits a pattern we have tracked this month, including the AI debt fears that handed the Nasdaq its worst week since June and Wednesday’s rally on SpaceX-Tesla merger talk. For readers following Meta’s products, we also covered the Meta Muse Charm AI gadget heading into the holidays.

The next markers for investors are the Class C record date, Meta’s 2027 budget and capacity plans, and the youth-related trials Meta says are scheduled in the coming months in the United States.

Sources

• Meta Investor Relations: Meta Reports Third Quarter 2026 Results
• CNBC: Stocks making the biggest moves midday
• Yahoo Finance: Stock market today, Oct. 22
• Wikimedia Commons: Facebook Campus, Menlo Park, CA (CC BY 3.0)