Despite a successful third quarter, social media company Meta Platforms suffered from a non-cash income tax charge of $15.9 billion in line with US President Donald Trump’s One Big Beautiful Bill.
Excluding the one-time tax charge, net income would have increased to $18.6 billion instead of the $2.7 billion booked.
“We expect a significant reduction in our US federal cash tax payments for the remainder of 2025 and future years due to the implementation of the One Big Beautiful Bill Act”, Meta Platforms stated.
Daily active users of Facebook, Instagram, WhatsApp, Messenger and Threads were 3.5 billion, up 8 per cent.
The company’s Reality Labs segment, which includes the Quest headset and its other VR and AR businesses, continued to bleed billions with an operating loss of $4.4 billion on revenue of $470 million.
No new VR headset
On an earnings call, CFO Susan Li told analysts Meta Platforms anticipates Reality Labs’ revenue for Q4 to be below the figure in Q4 2024, partly due to it not introducing a new VR headset this year.
“We’re still expecting significant year-over-year growth in AI glasses revenue in Q4 as we benefit from strong demand for the recent products that we’ve introduced, but that is more than offset by the headwinds to the Quest headsets”.
Meta Platforms ended the quarter with $44.5 billion in cash, cash equivalents and marketable securities, while its headcount of 78,450 employees was up 8 per cent due in part to a hiring spree for its Meta Superintelligence Labs (MSL) team.
The company forecast Q4 revenue to be in the $56 billion to $59 billion range. Li stated capital spending “will be notably larger” in 2026 than 2025, as it looks to build out more computing infrastructure for AI.
CEO Mark Zuckerberg stated the MSL team is off to a strong start, but the company needs to add more capacity as it works towards AI superintelligence. “I think that it’s the right strategy to aggressively front-load building capacity so that way we’re prepared for the most optimistic cases”, he said. “That way, if superintelligence arrives sooner, we will be ideally positioned for a generational paradigm shift and many large opportunities. And in the worst case, we would just slow building new infrastructure for some period while we grow into what we build”.
Source: Mobile World Live
Image Credit: Meta Platforms