WASHINGTON, D.C. — Meta Platforms Inc. reported third‑quarter 2026 results that fell short of analysts’ earnings‑per‑share expectations after an $18 billion settlement with state attorneys general added nearly $10 billion in legal expenses, while revenue rose 26% to $64.6 billion.

The company posted diluted earnings of $2.78 per share, missing the consensus estimate of $3.10, and its shares slipped 3.2% in after‑hours trading. Analysts at Morgan Stanley noted that “the scale of the settlement and the associated legal bill created a one‑time earnings drag that investors will need to absorb,” while still praising the revenue momentum.

KEY POINTThe company posted diluted earnings of $2.

Meta’s settlement resolves a multi‑state antitrust probe into its data‑privacy practices. The $18 billion payout, combined with $9.8 billion in accrued legal costs, reduced net income to $7.1 billion, down 14% year‑over‑year, despite a 28% jump in advertising revenue driven by AI‑enhanced ad products.

Investors are weighing the earnings miss against a broader market backdrop of a Federal Reserve policy pause. The S&P 500 edged higher on the day, and Meta’s price‑to‑earnings multiple compressed to 19.5x, suggesting the market is discounting the legal hit but remains confident in the platform’s long‑term growth.

Chief Financial Officer Susan Li told analysts that “the settlement was a responsible decision that protects the company’s future, and we are already implementing cost‑efficiency measures that should restore profitability in the next quarter.” Meta reaffirmed its full‑year revenue guidance of $260 billion, plus‑or‑minus 3%.

Industry observers note that Meta’s advertising rebound outpaces rivals such as Google and Amazon, whose Q3 ad sales grew 12% and 9% respectively. The company’s investment in the metaverse and generative AI remains a focal point for investors seeking upside beyond the core social media business.

Key Takeaways

• The $18 billion settlement and $9.8 billion legal expense lowered Q3 EPS to $2.78, missing consensus forecasts.
• Revenue grew 26% to $64.6 billion, driven by a 28% increase in advertising spend.
• Wall Street’s reaction was muted; the broader market remained supportive amid a Fed policy pause.

Overall, Meta’s third‑quarter performance underscores the financial impact of regulatory settlements while highlighting resilient revenue growth, setting the stage for investor scrutiny of cost‑control initiatives and future guidance.