Meta Q2 2026 Earnings: $2.4B Legal Charge, Revenue Up 28% to Over $60B - Variety

Jul 29, 2026 1:21pm PT Meta Takes $2.4 Billion Charge for Legal Proceedings in Q2, Revenue Booms 28% to Over $60 Billion By Todd Spangler Plus Icon Todd Spangler NY Digital Editor xpangler Latest Meta Takes $2.4 Billion Charge for Legal Proceedings in Q2, Revenue Booms 28% to Over $60 Billion 7 hours ago Ari Emanuel Blasts States’ ‘Trash’ Lawsuit Aimed at Blocking Paramount-Warner Bros. Merger, Claims It Threatens to ‘Destroy’ Competition 1 day ago FCC Slammed by Former Agency Officials Over Review of ABC’s Licenses: ‘An Assault on Free Speech Disguised as Regulatory Process’ 2 days ago See All Courtesy of Meta Meta continues to post soaring revenue, but the Mark Zuckerberg -led company took a big hit in the second quarter of 2026 related to legal proceedings and layoffs. The company, the parent of Facebook and Instagram, said it took $2.4 billion in charges “related to legal proceedings” in Q2; it didn’t immediately respond to an inquiry about what those referred to. In addition, Meta’s bottom line was dinged by $1.18 billion in severance expenses in connection with the May 2026 layoff of about 8,000 employees amid its companywide shift to prioritize AI. 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The company beat on the top line but missed Wall Street’s earnings forecast on the legal and severance-related charges. R&D costs in Q2 shot up 67%, to $21.7 billion. Excluding the Q2 legal charges and severance expenses, Meta’s operating income for the quarter would have increased 9% year over year, Li said on the investor call. As reported, Q2 operating income fell 8%. Meta expects Q3 2026 total revenue to be in the range of $61 billion-$64 billion (with analysts forecasting $63.24 billion for the period). Meta expects 2026 capital spending to be $130 billion-$145 billion (vs. $72.2 billion in 2025), narrowing the forecast from $125 billion-$145 billion previously. The company has said the increased investment is largely supporting its AI buildout. Other big tech companies, including Alphabet and Amazon, have also dramatically upped capex targets because of AI. On Tuesday, Meta announced it was investing over $10 billion in a strategic venture with BlackRock to develop and build a data center campus in El Paso, Texas. “AI is accelerating our core business today, powering our next generation of products, and opening the door to entirely new enterprise opportunities,” Zuckerberg, Meta’s chairman, CEO and co-founder, said in prepared remarks announcing Q2 earnings. “The results are already showing, and I’m optimistic about the potential ahead.” Zuckerberg has outlined an optimistic vision for AI superintelligence. In a Wall Street Journal op-ed published Tuesday, he argued that if powerful AI tools are widely distributed, society overall will benefit and there will be more jobs — not fewer. “Meta is committed to building [AI] with the principles of individual empowerment, invention and balance of power,” he wrote. The exec criticized the notion of “centralizing” AI power among a “handful of institutions,” saying he believes “delivering personal superintelligence to everyone” is the right way forward. Meta’s recent AI initiatives have included the new Muse Image model. But just days after launching the feature, the company suspended Muse Image’s feature that had let users generate images using public Instagram accounts , coming after widespread criticism over its opt-out policy including from Hollywood talent agencies. Meta’s total daily active users was 3.60 billion on average for June 2026, up from 3.56 billion three months prior and an increase of 3% year-over-year. Analysts on average expected Meta to report Q2 revenue of $60.17 billion and earnings of $7.22 per share, according to LSEG Data & Analytics. 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