Meta Q3 revenue hits record $64 billion, but teen lawsuit settlement weighs on earnings

Meta reported record third-quarter revenue of $64 billion for the July-to-September period, beating the $63.3 billion consensus forecast among analysts, according to Deadline. Earnings per share came in at $3.83, also above expectations, but the quarter's profit was weighed down by costs tied to a legal settlement involving teenage social media users.

The settlement, reached last August in a California case, provides for payments to the plaintiffs and others of up to about $18.59 billion. Meta said its reported costs and expenses for the quarter include a $9.89 billion charge related to that agreement. Without the legal expenses, earnings per share would have risen to $7.40 for the period.

CFO Susan Li said in the earnings release that the case may not be an isolated event, noting that Meta is keeping a close watch on regulatory and legal developments. She pointed to continued scrutiny of youth-related issues in several markets and a number of youth-related trials scheduled in the U.S. over the coming months.

Alongside the financial results, Meta said it is carrying out a 2-for-1 stock split and creating a new set of Class C shares. The new stock is set to begin trading in January 2027 and will be offered to existing shareholders, with proceeds from the issue helping to fund the company's heavy spending on artificial intelligence. The Class C structure also allows CEO and co-founder Mark Zuckerberg to retain control of Meta.

Meta has long worked to match the dominance it holds in social media within the booming AI field, and the company has recently gained traction with the launch of its virtual assistant Muse, which drew a positive reception. It also rolled out a frontier model called Muse Wonder, aimed at helping the offering reach greater scale.