SAN FRANCISCO, Oct. 21 (Xinhua) -- U.S. technology giant Meta Platforms reported a 26 percent year-on-year increase in third-quarter revenue on Wednesday, while operating profit fell 37 percent largely due to a multi-billion-dollar charge related to a legal settlement over teen mental health and social media.
According to the company's latest financial report, revenue rose to 64.60 billion U.S. dollars in the quarter ended Sept. 30, compared with 51.24 billion dollars a year earlier, exceeding analysts' expectations of 63.37 billion dollars.
Net income reached 9.86 billion dollars, up 264 percent from 2.71 billion dollars a year earlier, while diluted earnings per share increased to 3.83 dollars from 1.05 dollars. The year-earlier net income was affected by a one-time, non-cash tax charge of 15.93 billion dollars.
Operating income declined 37 percent to 12.99 billion dollars from 20.54 billion dollars a year earlier, with the operating margin narrowing to 20 percent from 40 percent.
Meta said its third-quarter expenses included a 9.89-billion-dollar charge related to an August agreement with U.S. state attorneys general to settle litigation concerning teen mental health and social media. Excluding the charge, operating income would have reached approximately 22.88 billion dollars.
Advertising revenue, which accounts for the overwhelming majority of Meta's business, increased to 63.06 billion dollars from 50.08 billion dollars a year earlier.
The company's family of apps, including Facebook, Instagram, Messenger and WhatsApp, recorded an average of 3.64 billion daily active users in September, up 3 percent from 3.54 billion a year earlier, representing an increase of approximately 100 million people. The figure also rose by about 40 million from June 2026.
Meta continued to expand its investment in artificial intelligence infrastructure. Capital expenditures, including principal payments on finance leases, totaled 34.91 billion dollars during the quarter.
Free cash flow turned negative at 2.12 billion dollars, compared with positive free cash flow of 10.63 billion dollars a year earlier.
Looking ahead, Meta forecast fourth-quarter revenue of between 73 billion and 76 billion dollars. It also narrowed its full-year capital expenditure forecast to between 135 billion and 145 billion dollars, raising the lower end from its previous projection of 130 billion dollars.
Separately, Meta announced plans to establish a new class of publicly listed, non-voting Class C common stock in January 2027. The move is intended to support future investment, acquisitions and employee compensation while preserving the company's existing voting structure. ■