US President Donald Trump’s One Big Beautiful Bill Act may result in Meta, one of the world’s most valuable companies, having an effective tax rate of 14%, significantly lower than its reported effective tax rate of 87%. This adjustment could transform its reported net income of $2.7bn into an effective $19bn.
Despite posting third-quarter revenue of $51bn and experiencing a 26% business growth, Meta saw its total expenses rise to $31bn, a 32% increase from the previous year. Capital expenditure, which includes principal payments on finance leases, reached $19.4bn, primarily driven by investments in servers, datacentres, and network infrastructure.
Chief Financial Officer Susan Li emphasized the company’s commitment to deploying capital towards developing leading AI products, models, and business solutions. She highlighted the strategic investments in infrastructure to support this work, aiming to maintain long-term flexibility to meet future capacity needs and adapt to evolving market trends.
Looking ahead, Li anticipates a significant increase in total expenses in 2026 compared to 2025, with infrastructure costs, cloud expenses, and depreciation being key drivers of growth. Employee compensation costs are also expected to contribute substantially to this growth, particularly in hiring AI and technical talent.
Despite the growth in AI and datacentre expenditure, Meta’s Reality Labs business experienced a decline in revenue, attributed to lower demand for the company’s new headsets. Mark Zuckerberg, Meta’s founder and CEO, expressed confidence in the potential of Meta’s AI glasses and emphasized the company’s leadership in this area.
Commenting on Meta’s financial results, Forrester’s Vice President Research Director Mike Proulx noted the company’s strong revenue and user growth in Q3 but highlighted the increased costs affecting Meta’s Reality Labs. He praised Meta’s innovation in AI-powered glasses and predicted an exciting future for the company.
