AI Takeaway
Meta reported a strong Q1 2026 with revenue surging 33.1% YoY to $56.3B and net income jumping 60.9% to $26.8B, driven by robust advertising demand, though R&D spending soared 45.7% and long-term debt more than doubled as the company aggressively invests in AI and infrastructure.
Revenue
$56.31B
++33.08% YoY
EPS (Basic)
$10.57
++60.39% YoY
Operating Income
$22.87B
++30.29% YoY
Filed · Source: SEC EDGAR 10-Q filing
Meta's total revenue grew 33.1% YoY to $56.3B in Q1 2026 (vs. $42.3B in Q1 2025), reflecting continued strength in its core digital advertising business supported by AI-driven ad targeting improvements and growing user engagement across its Family of Apps.
Source: Source: 10-Q Income Statement
Net income rose 60.9% YoY to $26.8B, with net margin expanding to approximately 47.5%, significantly above the prior year. This outsized profit growth relative to revenue suggests meaningful operating leverage and potentially favorable tax or non-operating items contributing to the bottom line.
Source: Source: 10-Q Income Statement & Key Ratios
R&D expenses surged 45.7% YoY to $17.7B, and investing cash outflows increased 68.3% YoY to -$33.7B, signaling Meta's intensified capital deployment into AI development, data centers, and infrastructure. D&A also rose 53.8% YoY to $6.0B, reflecting a rapidly expanding asset base.
Source: Source: 10-Q Income Statement & Cash Flow Statement
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Upgrade to unlockLong-term debt more than doubled YoY to $58.7B, pushing the debt-to-equity ratio to 0.62. While Meta's strong cash generation provides coverage, a significant increase in financial leverage raises refinancing and interest expense risks, particularly if advertising revenue were to slow materially.
Source: Source: 10-Q Balance Sheet
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Upgrade to unlockReported EPS of $7.31 versus the $6.92 analyst consensus — a +5.6% beat for Q1 FY2026.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $56.31B | $42.31B | +33.08% |
Cost of Revenue | $10.22B | $7.57B | +34.94% |
Operating Income | $22.87B | $17.55B | +30.29% |
Net Income | $26.77B | $16.64B | +60.86% |
EPS (Basic) | $10.57 | $6.59 | +60.39% |
EPS (Diluted) | $10.44 | $6.43 | +62.36% |
R&D Expense | $17.7B | $12.15B | +45.67% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $395.25B | $280.21B | +41.05% |
Current Assets | $109.77B | $90.23B | +21.65% |
Total Liabilities | $151.57B | $95.18B | +59.24% |
Current Liabilities | $46.75B | $33.89B | +37.96% |
Stockholders' Equity | $243.68B | $185.03B | +31.70% |
Cash & Equivalents | $23.43B | $28.75B | -18.52% |
Long-Term Debt | $58.75B | $28.83B | +103.78% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $32.23B | $24.03B | +34.13% |
Investing Cash Flow | $-33.68B | $-20.01B | -68.31% |
Financing Cash Flow | $-6.55B | $-19.5B | +66.39% |
Dividends Paid | $1.35B | $1.33B | +1.28% |
Share Buybacks | $0 | $12.75B | -100.00% |
D&A | $6B | $3.9B | +53.82% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Margin | 40.6% | 41.5% | -0.87% |
Net Margin | 47.5% | — | — |
ROE | 11.0% | — | — |
ROA | 6.8% | — | — |
Current Ratio | $2.348 | — | — |
Debt to Equity | $0.622 | — | — |
META reported strong financial performance in Q2 FY2025 with significant growth in revenue and net income, driven by increased operational efficiency and strategic investments.
Meta Platforms delivered record revenue of $201.0B in FY2025, up 22.2% YoY, driven by strong advertising growth and expanding operating leverage, though net income dipped 3.1% to $60.5B as R&D spending surged 30.8% to $57.4B reflecting massive AI and metaverse investments.
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Meta reported Q1 2026 diluted EPS of $10.44, up 62.4% YoY from $6.43, and revenue of $56.3B, up 33.1% YoY. These results reflect a very strong quarter, though comparison to Wall Street consensus estimates requires external analyst data not included in the SEC filing.
Meta's Q1 2026 highlights include revenue of $56.3B (+33.1% YoY), net income of $26.8B (+60.9% YoY), and an operating margin of 40.6%. The quarter was marked by aggressive AI and infrastructure investment, with R&D up 45.7% to $17.7B and long-term debt more than doubling to $58.7B.
Meta's revenue grew 33.1% YoY to $56.3B in Q1 2026, up from $42.3B in Q1 2025, driven by its core advertising business benefiting from AI-powered ad targeting and strong user engagement. Cost of revenue also rose 34.9% to $10.2B, reflecting higher infrastructure costs to support this growth.
Based on the financial data, key risks include rapidly escalating AI and capital expenditure commitments (investing outflows of -$33.7B, up 68.3% YoY), a more than doubling of long-term debt to $58.7B, and the complete suspension of share buybacks versus $12.8B repurchased in Q1 2025. Cost inflation in R&D and infrastructure is also outpacing revenue growth, which could pressure margins if advertising demand softens.
Meta's financial health appears strong, with a current ratio of 2.35, operating cash flow of $32.2B, and stockholders' equity of $243.7B. However, the company is in a heavy investment phase, with long-term debt doubling to $58.7B and free cash flow turning slightly negative at approximately -$1.5B as capital expenditures surged.