5 of the biggest takeaways from Meta's Q4 2025 earnings call

• Meta reported its Q4 2025 earnings on Wednesday. These are the top takeaways.
• Meta expects to spend more in 2026: up to $135 billion on capex, including AI infrastructure.
• Meta's ad revenue is still its powerhouse, and AI is improving ad targeting.

Meta's earnings sent a clear signal to Wall Street on Wednesday: while its core advertising engine is still firing on all cylinders, the price tag for CEO Mark Zuckerberg's AI ambitions will skyrocket in 2026.

The company reported $59.89 billion in revenue for the fourth quarter of 2025, topping Wall Street's forecasts. Meta's stock jumped as high as 10% in after-hours trading.

Alongside the upbeat numbers, Meta laid out how hard it plans to push in 2026. The company said it expects to spend $115 billion to $135 billion next year on capital expenditures — largely on the computers and data centers that power AI.

In other words, Meta still makes most of its money from ads. It's asking investors to stay on board as it pours an extraordinary amount of cash into the race to build more powerful AI and weave it into Instagram, WhatsApp, Facebook, and virtual and augmented reality products, collectively used by more than 3.5 billion people daily around the world.

Here are five takeaways from Meta's Q4 2025 earnings call.

Meta's AI spending plan just got bigger

Meta told to brace for a much more expensive 2026 as it pours money into the compute and data centers needed to power its AI push. The company said it expects capital expenditures in 2026 to land between $115 billion and $135 billion — up to almost double the $72 billion it spent in 2025.

Meta's chief financial officer, Susan Li, said the increased expenditure will support Meta Superintelligence Labs' efforts and its core business.

Li also warned that Meta's overall costs are set to climb fast. The company expects total 2026 expenses of $162 billion to $169 billion, with most of the increase coming from "infrastructure costs," including "third-party cloud spend, higher depreciation, and higher infrastructure operating expenses."

And Meta isn't just buying more machines — it's also paying for people to run them. Li said the "second-largest contributor" to expense growth will be compensation, driven by "investments in technical talent," including hires in "priority areas, particularly AI."

Meta's ad machine still does the heavy lifting

Advertising once again powered Meta's quarter. The company reported $58.14 billion in ad revenue in Q4 2025, up 24% from the same time last year. That growth came from a mix of showing more ads (ad impressions rose 18% from the same quarter last year) and charging a bit more per ad (average price per ad rose 6%).

When analysts pressed Zuckerberg on whether Meta can build meaningful businesses beyond ads, given how much cash it's pouring into AI, he didn't dodge the question of its dependency.

"For the next couple of years, ads are going to be by far the most important driver of growth in our business," Zuckerberg said, adding that Meta is working on new bets alongside that core engine.

Meta's pitch is that its AI investments are already making the ad machine work better — not just by targeting, but by improving the systems that decide which ads people will most likely engage with.

The company said that its AI tools for making video ads hit a $10 billion revenue run rate. It also said a newer measurement product helped advertisers drive 24% more conversions than its standard method — and ramped up to a multi-billion-dollar annual run rate in just seven months.

Reality Labs is still a drag

Reality Labs, the division behind Meta's virtual and augmented reality efforts, continued to burn cash in the final quarter of 2025. The division lost $6.02 billion in a quarter, the highest ever, and $19.19 billion in 2025 — numbers that underscore how much Meta's ambitions to build immersive worlds still depend on ad revenue.

Despite laying off about 1,500 people at Reality Labs earlier this month, Meta told investors not to expect a sudden turnaround. Li said the company expects Reality Labs' operating losses in 2026 to remain "similar to 2025 levels."

Zuckerberg is trying to reposition what Reality Labs is building. The company's focus has shifted from trying to go all in on the "metaverse" to building AI-powered smart glasses and experiences that could live inside Meta's existing apps.

When Barclays analyst Ross Sandler asked about Meta's plans to bring Horizon Worlds, a virtual hangout zone accessible on the company's Quest VR headsets, to mobile, Zuckerberg said that he expects more "interactive and immersive" content formats to show up directly inside the feeds in Meta's existing apps.

He added that people might be able to use AI to create a game with a single prompt and share it on their feeds so that others can "jump right into it."

He positioned Horizon Worlds as a natural fit for an "immersive 3D" version of that idea and said that Meta's work on VR software and Horizon could pair with AI advances to bring these kinds of experiences to "hundreds of millions and billions of people through mobile."

Meta's AI strategy: build the model, don't rent it

Meta isn't just trying to sprinkle AI features across Facebook and Instagram. Zuckerberg is making a bigger argument: if Meta wants to shape the next generation of consumer tech, it needs to control the underlying AI, not just depend on whatever rivals sell.

That's also the framing behind his public push for "personal superintelligence," which he called out again as a key focus for 2026.

When Wells Fargo analyst Ken Gawrelski asked how critical it is for Meta to have a general-purpose model, Zuckerberg leaned into Meta's identity as a "deep technology company."

What allows Meta to build everything it does, he said, "is that we build and control the underlying technology." That way, Meta can design the experiences it wants, "and not just be constrained to what others in the ecosystem are building or allow us to build," Zuckerberg added.

He suggested that relying on outside models could become risky over time, citing a mix of competitive and safety reasons. That's why, he said, it's important for Meta to have its own models, both from a business perspective and because Meta wants to "actually design and build the experiences that we believe that we should be building for people."

Fewer layers, more AI

Zuckerberg is pitching 2026 as the year AI changes not just Meta's products, but how Meta itself operates. On the call, he said 2026 will be "the year that AI starts to dramatically change the way that we work" and that the company is "investing in AI native tooling so individuals at Meta can get more done."

He also described a deliberate shift in org design.

"We're elevating individual contributors and flattening teams," Zuckerberg said, adding that Meta is already seeing "projects that used to require big teams now be accomplished by a single, very talented person."

Li paired that cultural pitch with a concrete productivity claim. She said that since the beginning of 2025, Meta has seen a "30% increase in output per engineer" overall, and that "power users" of its internal AI coding tools saw output rise 80% year-over-year.

The company's implied bet? Spend heavily on AI infrastructure and tooling, and then run leaner teams that can ship more.

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