Meta's revenue hits $64.6 billion as average price per ad rises 14%

Meta Platforms, the owner of Facebook, Instagram and WhatsApp, reported on Wednesday (Oct. 21) third-quarter 2026 revenue of $64.6 billion, up 26% from a year earlier. Nearly all of it came from advertising: $63.06 billion, also up 26%. Growth came from two sources: ad impressions, the number of times an ad is shown, rose 10%, and the average price per ad climbed 14%. Revenue beat the $63.34 billion market estimate cited by Brazilian news site Poder360.

The company credits artificial intelligence used to deliver ads. On the call with analysts, Chief Financial Officer Susan Li said the higher average price was driven by ad performance gains and that impressions grew across all regions on higher engagement and more users. Nearly 10 million advertisers used at least one of Meta's generative AI tools to create ads in the quarter, she said. Partnership ads, which advertisers run with content creators, grew more than 97% and passed a $15 billion annual revenue run rate. Meta's apps averaged 3.64 billion daily users in September, up 3% from a year earlier.

Costs are the other side of the report. Total expenses reached $51.61 billion, up 68%. That includes a $9.89 billion charge tied to an August agreement with attorneys general from 52 U.S. states and territories to settle litigation over teen mental health and social media; payments under the agreement could reach about $18.59 billion. As a result, operating income fell 37% to $12.99 billion, and the operating margin dropped to 20% from 40%. Capital expenditures, mainly servers and data centers, totaled $34.91 billion in the quarter, and free cash flow was negative $2.12 billion.

What changes for businesses

For companies advertising on Facebook and Instagram, the most relevant number in the report is the average price per ad. When it grows faster than impression volume, as it did this quarter, each impression becomes more expensive on average. In practice, that tends to show up in CPM, the cost per thousand impressions, and, absent an equivalent gain in conversions, in customer acquisition cost (CAC). The figure is a global average: Meta did not break it out by country in its release, and the trend in Brazil may differ.

Meta argues that advertisers pay more because ads deliver better results, thanks to AI models that decide who sees each ad. The growth of automated creative tools and creator partnership ads shows where the platform is steering budgets: less manual targeting and more reliance on Meta's own systems. Against that backdrop, comparing media spend with sales recorded outside the platform carries more weight in evaluating campaigns, especially for small and midsize businesses.

Investors reacted negatively. Meta shares were down more than 8% at around 11:30 a.m. on Thursday (Oct. 22), according to Brazilian financial site Money Times. Analysts at Brazil's Banco Safra cited by the site pointed to heavy capital spending, negative free cash flow and the creation of a new class of non-voting shares, planned for January 2027.

“Our investments are paying off, the core business is strong”

— Mark Zuckerberg, Meta founder and CEO, in the earnings release

What to watch next

• Fourth-quarter revenue: Meta forecasts $73 billion to $76 billion
• Spending: the 2026 capex outlook was narrowed to $135 billion to $145 billion, and full-year total expenses are expected at $175 billion to $179 billion
• 2027: the company expects strong revenue growth but plans to detail budget and investment plans only with fourth-quarter results
• Monetization of Muse, Meta's AI assistant, which has passed 10 million users; the company expects revenue from it starting in 2027
• The new class of non-voting shares, scheduled to start in January 2027