Meta revenue surged 26%, but profits are under pressure! Is Zuckerberg’s AI gamble delivering enough returns?

Revenue growth of 26% sounds like a cheat code—but if spending is also soaring, will shareholders really have the last laugh?
Meta’s latest quarterly revenue reached $64.6 billion, up 26% year over year, with advertising still its main profit engine. AI is helping the platform optimize ad placement and boost user engagement, making advertisers more willing to spend. In other words, AI can’t just chat; it has to make money to truly earn its place.
But the other side is also worth watching: legal expenses, infrastructure development, and AI investment could all squeeze profits and free cash flow. Impressive revenue growth doesn’t mean every dollar of revenue turns into hard cash in shareholders’ pockets.
My view is that Meta’s most compelling point right now isn’t how much it’s spending on AI, but that AI is already creating observable commercial value for its advertising business. The key going forward is whether these gains can continue to offset higher computing, talent, and capital costs.
After all, AI can burn cash at first, but it can’t burn cash forever. Investors are buying future returns, not data center electricity bills.
Discussion: Are you more confident in Meta’s ability to monetize ads, or concerned that its AI spending is too high?
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