Meta Platforms (META) Q1 2026 (USD): Diluted EPS 10.44 (exp. 6.66), Revenue 56.3bln (exp. 55.54bln)
- Note diluted EPS includes an 8.03bln income tax benefit recognized in the first quarter of 2026, which partially offsets the 15.93bln non-cash tax charge recorded in the third quarter of 2025 upon enactment of the One Big Beautiful Bill Act. Excluding this tax benefit, our effective tax rate would have been 37 percentage points higher and our diluted EPS would have been 3.13 lower.
- Operating income 22.9bln (exp. 19.4bln).
- Family daily active people 3.56B in March 2026, +4% Y/Y.
Outlook
- Q2 revenue 58-61bln (exp. 59.5bln).
- Anticipate 2026 capital expenditures, including Principal payments on finance leases, to be in range of 125-145bln (prev. 115-135bln); reflects our expectations for higher component pricing this year and, to a lesser extent, additional data center costs to support future year capacity.
- FY 2026 total expenses to be in the range of 162-169bln, unchanged from our prior outlook.
- We continue to see scrutiny on youth-related issues and have additional trials scheduled for this year in the US, which may ultimately result in a material loss.
Context
Meta Platforms has significantly outperformed expectations in Q1 2026, delivering both a much higher diluted EPS and revenue than anticipated. While the positive EPS result was inflated by an income tax benefit, it suggests better operational efficiency, with strong revenue growth and user engagement. The guidance for Q2 remains robust but highlights potential pressures from increasing capital expenditures and ongoing regulatory scrutiny, which investors should monitor closely.
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