Meta said Q2 profit fell as legal and severance costs pushed expenses higher.
Why it matters: The results show whether Meta's ad growth can keep offsetting litigation, restructuring and AI spending. As one of the biggest megacap tech names, its print can ripple through broader market sentiment.
- Meta reported Q2 2026 net income of $15.848 billion, down 14% from a year earlier.
- Revenue rose 28% to $60.801 billion, while costs and expenses jumped 55% to $42.026 billion.
- The company booked $2.40 billion in legal proceedings charges and $1.18 billion in severance tied to May layoffs.
- AP reported Meta shares fell 4.2% after hours to $560.85 after the earnings release.
Meta reported second-quarter 2026 results on July 29, saying revenue rose sharply but profit fell as costs accelerated. Net income dropped to $15.848 billion from $18.337 billion a year earlier, while diluted EPS fell to $6.18 from $7.14, according to the company's earnings release published here.
The company said costs and expenses totaled $42.026 billion, up 55% year over year, including $2.40 billion in charges related to legal proceedings and $1.18 billion in severance tied to the May 2026 headcount reduction. Meta said roughly 8,000 employees were affected by that reduction.
Revenue came in at $60.801 billion, up from $47.516 billion a year earlier. Meta said ad impressions across its family of apps increased 14% year over year, while average price per ad increased 12% year over year. The company also reported 3.60 billion average daily active people across its family of apps in June 2026, up 3% year over year.
Meta raised the lower end of its full-year 2026 expense outlook to $165 billion from $162 billion to reflect the legal charges, and said Q3 revenue should land between $61 billion and $64 billion. Mark Zuckerberg said, "AI is accelerating our core business today, powering our next generation of products, and opening the door to entirely new enterprise opportunities." He added, "The results are already showing, and I'm optimistic about the potential ahead." AP reported the stock fell 4.2% in after-hours trading to $560.85 after the release in this report.
By the numbers
- $15.848 billion - Meta's Q2 2026 net income, down 14% year over year
- $60.801 billion - Q2 2026 revenue, up 28% year over year
- $42.026 billion - Q2 costs and expenses, up 55% year over year
Yes, but: Ad growth was still strong, but legal charges, severance and higher spending sharply reduced profitability and free cash flow.
What's next: Meta said Q3 2026 revenue is expected to be $61 billion to $64 billion, and full-year 2026 expenses are now expected to be $165 billion to $169 billion.