Meta closed the second quarter of 2026 with advertising revenue of 59.4 billion dollars, up 27% year on year, and total revenue of 60.8 billion dollars, up 28%. Revenue beat expectations. Earnings did not, and the share price fell after the announcement.
The company used the earnings call to argue that its artificial intelligence spending is already visible in the numbers. Mark Zuckerberg told analysts that on a pure dollar basis, no other company is reporting faster year on year growth in its advertising business, which he framed as proof the AI bet is working.
Where the growth is coming from
Advantage+, the automated campaign suite, has now reached an annual revenue run rate of 75 billion dollars. The bigger structural change is the Meta Generative Recommender, rolled out during the quarter and described by CFO Susan Li as a shift in how the platform selects ads.
Instead of scoring each ad in isolation, the system uses large language models to interpret ad content and user preference together, then predicts the single best ad for that person. In practical terms, that means fewer levers for advertisers to pull manually and more weight on creative quality and signal quality feeding the system.
The guidance problem
Meta forecast third quarter revenue between 61 and 64 billion dollars, below what the market wanted. Two reasons were given.
- The company is lapping an unusually strong period of ad impression growth from last year
- European policy changes now let users opt into less personalised advertising, which weakens targeting in that market
For advertisers running EU campaigns, that second point matters more than the headline number. Less personalisation means broader audiences, weaker attribution, and more reliance on first party data feeding back into the platform.
The capex question
Meta raised the floor on its full year capital expenditure forecast, moving the range to 130 to 145 billion dollars from 125 to 145 billion dollars. The ceiling has not moved, but the minimum spend has.
Revenue outside advertising did grow. Other family of apps revenue rose 73% to reach 1 billion dollars for the first time, helped by WhatsApp paid messaging and subscription products. Against a 60 billion dollar quarter, that remains a rounding error.
Forrester analyst Mike Proulx summarised the tension bluntly, noting that Meta now treats AI infrastructure as a strategic asset but the bill is arriving ahead of the return. His point was that the advertising engine remains enormous while almost everything else in the business has become more expensive to run.
What it means for advertisers
Some analysts expect Meta to overtake Google in digital advertising revenue for the first time this year, although Google has cloud computing and other segments cushioning it.
For anyone buying Meta media, the direction is clear. Manual targeting control keeps shrinking, automated placement keeps expanding, and performance increasingly depends on creative volume and clean conversion signals rather than audience definitions.
