Meta shares jump 5% as AI investments fuel revenue growth
Meta Platforms said Wednesday that its third-quarter profit jumped more than threefold, as the social media giant's revenue climbed sharply, adding to confidence that the firm's AI spending is improving the business.
Meta's shares jumped by 5% after-hours on Wednesday as the company reported strong growth and credited its AI investments. Meta's core advertising business saw a 26% increase in total revenue to $64.6 billion, driven by AI recommendations, higher ad placements, and rising ad prices. The company's Muse, a personal artificial intelligence agent launched in September, has attracted over 10 million users in the U.S. and Canada, with users spending an average of $200 per purchase.
CEO Mark Zuckerberg stated that Muse could generate more revenue per user than popular apps like Instagram and Facebook, with plans for subscriptions, ads, and e-commerce tools. The company expects to scale Muse to one billion users globally and achieve profitability through cost efficiency improvements. For the July-September period, Meta reported net income of $9.86 billion, or $3.83 per share, up from $2.71 billion, or $1.05 per share, a year earlier.
The number of daily active users across Meta's apps grew 3% to an average of 3.64 billion in September. However, Meta's quarterly free cash flow turned negative for the first time since 2012 due to heavy AI spending. The company now anticipates capital expenditures of $135 billion to $145 billion for 2026, up from the previous range of $130 billion to $145 billion.
Despite regulatory challenges, including a $25 billion penalty from New Mexico and legal actions related to youth privacy concerns, Meta remains confident in its AI-driven growth strategy and the upcoming 2026 tax bill.
Written by urgent.news from Euronews's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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