Meta Platforms shares fell sharply after the company reported a 14% decline in second-quarter profit, despite strong revenue growth, as investors reacted to massive artificial intelligence spending plans.
The social media giant's profit dropped to $15.85 billion, or $6.18 per share, from $7.14 a year earlier, while revenue climbed 28% to $60.8 billion. Daily active users across Meta's family of apps grew 3% to 3.6 billion. However, free cash flow plummeted 91% to $784 million, the lowest in at least five years, as capital expenditures reached $31.1 billion.
Meta raised its full-year AI investment forecast to $130–145 billion, signaling continued heavy spending on infrastructure. The company guided third-quarter revenue between $61 billion and $64 billion and expects full-year operating profit to exceed last year's $83.3 billion. Shares fell more than 7% in after-hours trading following the July 29 results.