Meta's Q3 ad revenue rises 26% but legal charge cuts profit by 37%

Meta reported Q3 revenue of $64.6 billion, a 26% rise year over year, with a 10% increase in ad impressions and a 14% rise in global average ad price. The company invested $34.9 billion in capital expenditures, focusing on servers, data centres and network infrastructure to support its AI-driven advertising business.

However, Meta recognised a $9.9 billion pre-tax charge related to the August 2026 Multi-State Attorneys General Agreement, which addresses lawsuits over the platform's handling of youth mental health. This expense cut Q3 GAAP operating income by 37% to $13 billion, reducing the operating margin to 20%. CFO Susan Li said that without the legal settlement, operating income would have grown 11% year over year.

For regulated-industry marketers, Meta's results show the commercial gains possible from AI-powered ad delivery, but also the scale of legal and reputational risk from regulatory action. The size of the legal charge signals ongoing scrutiny of digital platforms by US authorities.

Executives should watch for further regulatory developments and assess their own risk exposure in digital campaigns, especially those targeting youth.