Meta Reports Strong Quarterly Earnings Amid AI Investments
Meta, the parent company of Facebook and Instagram, has announced quarterly earnings that exceeded market expectations, driven by revenue growth and significant investments in artificial intelligence. The company reported a profit of $22.8 billion on revenue of nearly $60 billion in the recently ended quarter, with projected revenue of up to $56.5 billion in the current quarter.
According to Meta’s co-founder and chief executive Mark Zuckerberg, the company had a strong business performance in 2025. Meta’s shares rose by over 8% in after-market trades following the earnings report. The social networking giant also reported that 3.58 billion people used its apps daily in the quarter, which are being enhanced with AI technology.
However, Meta’s costs increased by 40% from the same period last year, totaling $35.15 billion. The company’s capital expenses, including infrastructure such as data centers to power AI, were $22.14 billion in the quarter. Meta expects to spend over $100 billion this fiscal year, driven by increased investment in its Superintelligence Labs and core business.
Zuckerberg has predicted that AI-infused smart glasses will be the next major computing platform, eventually replacing smartphones. However, Meta’s virtual and augmented reality unit, Reality Labs, has consistently posted significant losses. The company is locked in a bitter rivalry with other tech giants to invest heavily in AI, aiming to ensure the technology benefits society and generates profits in the future.
The earnings report comes as Meta faces a landmark trial in Los Angeles, accusing the company of addicting young people to social media. The trial, which could set the tone for similar litigation across the US, focuses on allegations that a 19-year-old woman suffered severe mental harm due to social media addiction. Meta and YouTube are the remaining defendants, with Zuckerberg slated to be called as a witness.
Social media firms are accused in hundreds of lawsuits of addicting young users to content that has led to depression, eating disorders, and even suicide. While internet titans argue that they are shielded by Section 230 of the US Communications Decency Act, this case argues that companies are culpable for business models designed to hold people’s attention and promote harmful content. Meta and YouTube have rejected the allegations.
The outcome of the trial could have significant implications for Meta and other social media companies, with potential regulatory and legal repercussions. As the case unfolds, Meta will continue to monitor legal and regulatory headwinds in Europe and the US, which could impact its business.
