Meta just dropped its Q2 2026 earnings, and the numbers are as schizophrenic as they come. Revenue hit a record $60.8 billion, up 28% year-over-year and beating analyst expectations. But net income fell 14% to $15.8 billion, earnings per share missed estimates, and the stock shed nearly 10% in after-hours trading.
The ad business remains the cash cow. Ad revenue came in at $59.4 billion, up 27%. Impressions grew 14%, while the average ad price jumped 12%. Daily active users across Meta's family of apps reached 3.6 billion, a 3% increase.
Here's where things get ugly. Total costs and expenses surged 55% to $42 billion, including $2.4 billion in legal charges and $1.18 billion in severance costs from layoffs. Capital expenditures hit $31.1 billion — nearly eating up all of the operating cash flow. Free cash flow? Just $784 million. That's a 91% drop from the same quarter last year.
Meta is doubling down on AI infrastructure. The company raised its full-year capex guidance to between $130 billion and $145 billion, up from the initial range of $115 billion to $135 billion. For Q3, revenue is expected between $61 billion and $64 billion, with the midpoint below analyst forecasts.