Meta stock drops after tax charge hits Q3 earnings
Meta (META) on Wednesday reported third-quarter earnings that beat expectations on revenue but fell short on earnings per share.
The shortfall was due to a one-time tax-related charge and increased capital expenditures this year and in the year ahead related to its AI buildout, News.Az reports, citing foreign media.
Following the announcement, Meta stock plummeted more than 6%.
For Q3, Meta saw earnings per share of $1.05 and revenue of $51.24 billion versus expectations of EPS of $6.72 on revenue of $49.6 billion, according to Bloomberg consensus estimates.
Family of apps revenue hit $50.77 billion versus an anticipated $48.6 billion.
The social media giant has been on a massive spending spree in recent months, laying out billions to hire talent and build the data centers necessary to meet its demand for AI.
To that end, Meta says it's increasing its capital expenditures estimates for the year to $70 billion-72 billion versus its prior outlook of $66 billion-72 billion.
So far, spending includes investing $14.3 billion in Scale AI (SCAI.PVT) and hiring its CEO as chief AI officer; plowing at least $1.5 billion into a new data center in El Paso, Texas; entering into a $27 billion financing deal with Blue Owl Capital to pay for its massive Hyperion data center in Richland Parish, La., and pouring millions more into poaching AI experts from rival tech firms, including OpenAI and Apple.
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