Meta set to report Q3 earnings amid rising AI spending and losses in Reality Labs
Meta is expected to post earnings of $3.56 per share on $63.3 billion revenue for the third quarter, while capital spending and losses in its Reality Labs unit are projected to rise sharply.
Meta will release its third-quarter results after market close on Wednesday, marking the start of the Big Tech earnings season. Analysts surveyed by Bloomberg forecast earnings per share of $3.56 on revenue of $63.3 billion, up from $1.05 per share and $51.2 billion a year earlier.
Capital expenditures are projected to more than double year over year, reaching $41 billion, and the Reality Labs division is expected to record an operating loss of $5.2 billion.
The figures come as investors weigh the broader AI market outlook. A recent Gartner report warned that while AI infrastructure firms may spend $8.5 trillion through 2030, total consumer and enterprise AI revenue is projected at $3.6 trillion, leaving over $4 trillion in potential asset write-down risk through 2032.
Meta’s stock has fallen more than 3 percent over the past year as analysts seek clarity on the company’s monetisation strategy for its expanding AI investments.
Recent product milestones include the Muse AI agent reaching 10 million downloads within 40 days of its U.S. launch, outpacing comparable milestones for OpenAI’s ChatGPT and Anthropic’s Claude. The company also introduced new AI models, Muse Wonder and Muse Wonder Full, and unveiled hardware such as updated Ray-Ban Meta glasses, audio-only Ray-Ban Meta Audio glasses, and a forthcoming $1,299 Meta VR headset at its Meta Connect conference.
"Recent AI launches have strengthened confidence in the company's AI execution, and we see Meta with the least risk of AI disruption to its core business in our coverage," BofA Global Research analyst Justin Post wrote in a note to investors ahead of the earnings release.