Meta Platforms, Inc.

Previous wording

To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States (GAAP), we present revenue on a constant currency basis, which is a non-GAAP financial measure. Revenue on a constant currency basis is presented in the section entitled "—Revenue—Foreign Exchange Impact on Revenue." To calculate revenue on a constant currency basis, we translated revenue for the three months ended March 31, 2026 using the prior year's monthly exchange rates for our settlement or billing currencies other than the U.S. dollar.

Current wording

To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States (GAAP), we present revenue on a constant currency basis, which is a non-GAAP financial measure. Revenue on a constant currency basis is presented in the section entitled "—Revenue—Foreign Exchange Impact on Revenue." To calculate revenue on a constant currency basis, we translated revenue for the three and six months ended June 30, 2026 using the prior year's monthly exchange rates for our settlement or billing currencies other than the U.S. dollar.

Previous wording

Our financial results and key Family metrics for the first quarter of 2026 are set forth below. Total revenue for the first quarter of 2026 was $56.31 billion, an increase of 33% compared to the first quarter of 2025, due to an increase in advertising revenue. Revenue on a constant currency basis would have increased 29% compared to the first quarter of 2025. Ad impressions delivered across our Family of Apps in the first quarter of 2026 increased 19% year-over-year, and our average price per ad in the first quarter of 2026 increased 12% year-over-year.

Current wording

Our financial results and key Family metrics for the second quarter of 2026 are set forth below. Total revenue for the second quarter of 2026 was $60.80 billion, an increase of 28% compared to the second quarter of 2025, due to an increase in advertising revenue. Revenue on a constant currency basis would have increased 27% compared to the second quarter of 2025. Ad impressions delivered across our Family of Apps in the second quarter of 2026 increased 14% year-over-year, and our average price per ad in the second quarter of 2026 increased 12% year-over-year.

Previous wording

Income from operations for the first quarter of 2026 was $22.87 billion, an increase of $5.32 billion, or 30%, compared to the first quarter of 2025, driven by an increase in advertising revenue, partially offset by an increase in costs and expenses. The increase in costs and expenses was mainly due to increases in infrastructure costs and employee compensation.

Current wording

Income from operations for the second quarter of 2026 was $18.78 billion, a decrease of $1.67 billion, or 8%, compared to the second quarter of 2025, driven by higher costs and expenses. The increase in costs and expenses was primarily due to increases in employee compensation, including severance expenses; infrastructure expenses related to our data centers, technical infrastructure, and third-party cloud services; legal-related costs; and third-party AI token costs.

Previous wording

•Net income was $26.77 billion, with diluted earnings per share (EPS) of $10.44 for the three months ended March 31, 2026.

Current wording

•Net income was $15.85 billion, with diluted earnings per share (EPS) of $6.18 for the three months ended June 30, 2026.

Previous wording

•Capital expenditures, including principal payments on finance leases, were $19.84 billion for the three months ended March 31, 2026.

Current wording

•Capital expenditures, including principal payments on finance leases, were $31.08 billion for the three months ended June 30, 2026.

Previous wording

•Family daily active people (DAP) was 3.56 billion on average for March 2026, an increase of 4% year-over-year.

Current wording

•Family daily active people (DAP) was 3.60 billion on average for June 2026, an increase of 3% year-over-year.

Previous wording

•Ad impressions delivered across our Family of Apps in the first quarter of 2026 increased by 19% year-over-year.

Current wording

•Ad impressions delivered across our Family of Apps in the second quarter of 2026 increased by 14% year-over-year.

Previous wording

•Average price per ad in the first quarter of 2026 increased by 12% year-over-year.

Current wording

•Average price per ad in the second quarter of 2026 increased by 12% year-over-year.

Previous wording

In particular, legislative and regulatory developments such as the General Data Protection Regulation, including its evolving interpretation through decisions of the Court of Justice of the European Union, ePrivacy Directive, European Digital Services Act, Digital Markets Act, and U.S. state privacy laws have impacted our ability to use data signals in our ad products, and an increasing number of laws have been introduced limiting or prohibiting the provision of our services to younger users. We expect these and other developments will have further impact in the future. As a result, we have implemented, and we will continue to implement, whether voluntarily or otherwise, changes to our products and user data practices, which reduce our ability to effectively target and measure ads and may negatively impact our advertising revenue and user engagement. For example, in response to regulatory developments in Europe, we announced our plans to change the legal basis for behavioral advertising on Facebook and Instagram in the European Union, European Economic Area, and Switzerland from "legitimate interests" to "consent," and began offering users in the region a "subscription for no ads" alternative. We subsequently began offering users in the region who elect to continue using our services free-of-charge, supported by ads, an option to see less personalized ads, which are less relevant and effective than our premium ad offerings.

Current wording

In particular, legislative and regulatory developments such as the General Data Protection Regulation, including its evolving interpretation through decisions of the Court of Justice of the European Union, ePrivacy Directive, European Digital Services Act, Digital Markets Act, and U.S. state privacy laws have impacted our ability to use data signals in our ad products, and an increasing number of laws have been introduced limiting or prohibiting the provision of our services to younger users. We expect these and other developments will have further impact in the future. As a result, we have implemented, and we will continue to implement, whether voluntarily or otherwise, changes to our products and user data practices, which reduce our ability to effectively target and measure ads and may negatively impact our advertising revenue and user engagement. For example, in response to regulatory developments in Europe, we announced our plans to change the legal basis for behavioral advertising on Facebook and Instagram in the European Union, European Economic Area, and Switzerland from "legitimate interests" to "consent," and began offering users in the region a "subscription for no ads" alternative. We subsequently began offering users in the region who elect to continue using our services free-of-charge, supported by ads, an option to see less personalized ads, which are less relevant and effective than our premium ad offerings. We are engaging with regulators on our consent model. In addition, mobile operating system and browser providers, such as Apple and Google, have implemented product changes and/or announced plans to limit the ability of websites and application developers to collect and use these signals to target and measure advertising. For example, in 2021, Apple made certain changes to its products and data use policies in connection with changes to its iOS operating system that reduce our and other iOS developers' ability to target and measure advertising, which has negatively impacted, and we expect will continue to negatively impact, the size of the budgets marketers are willing to commit to us and other advertising platforms.

Previous wording

Other global and regional business, macroeconomic, and geopolitical conditions also have had, and we believe will continue to have, an impact on our user growth and engagement and advertising revenue. In particular, we believe advertising budgets have been pressured from time to time by factors such as inflation, economic policies and international trade, high interest rates, and related market uncertainty, which has led to reduced marketer spending. We are currently subject to increased business, macroeconomic, and geopolitical uncertainty, including as a result of the conflict in the Middle East and volatility around international trade, which could impact our financial results in future periods.

Current wording

Other global and regional business, macroeconomic, and geopolitical conditions also have had, and we believe will continue to have, an impact on our user growth and engagement and advertising revenue. In particular, we believe advertising budgets have been pressured from time to time by factors such as inflation, economic policies and international trade, high interest rates, and related market uncertainty, which has led to reduced marketer spending. We are currently subject to increased business, macroeconomic, and geopolitical uncertainty, including as a result of the conflict in the Middle East and volatility around international trade, which has impacted and could continue to impact our financial results.

Previous wording

We remain focused on operating efficiently while investing in significant opportunities. In the three months ended March 31, 2026, 87% of our total costs and expenses were recognized in FoA and 13% were recognized in RL. Our FoA investments include expenses relating to headcount, data centers, and technical infrastructure as part of our efforts to develop our apps and our advertising services. These efforts include significant investments in AI initiatives, including generative AI and superintelligence, to, among other things, recommend relevant content across our products, enhance our advertising tools, develop new products, and develop new features for existing products. In particular, we have significantly increased our infrastructure investments in connection with our AI initiatives, including third-party cloud capacity arrangements and investments in servers, data centers, and network infrastructure, and expect our investments to continue to increase. Further, as we continue to make significant investments, we also continue to evaluate our workforce and other needs across our business to optimize for our business and strategic priorities.

Current wording

We remain focused on operating efficiently while investing in significant opportunities. In the six months ended June 30, 2026, 87% of our total costs and expenses were recognized in FoA and 13% were recognized in RL. Our FoA investments include expenses relating to headcount, data centers, and technical infrastructure as part of our efforts to develop our apps and our advertising services. These efforts include significant investments in AI initiatives, including generative AI and superintelligence, to, among other things, recommend relevant content across our products, enhance our advertising tools, develop new products, and develop new features for existing products. In particular, we have significantly increased our infrastructure investments in connection with our AI initiatives, including third-party cloud capacity arrangements and investments in servers, data centers, and network infrastructure, and expect our investments to continue to increase. Further, as we continue to make significant investments, we also continue to evaluate our workforce and other needs across our business to optimize for our business and strategic priorities.

Previous wording

We are also making significant investments in our RL efforts, including developing virtual and augmented reality devices, software for social platforms, neural interfaces, and other foundational technologies. Our RL investments include expenses relating to technology development across these efforts. Many of our RL investments are directed toward long-term, cutting-edge research and development for products that may only be fully realized in the next decade. During the three months ended March 31, 2026, our RL segment reduced our overall operating profit by approximately $4.03 billion, and we expect our full-year 2026 RL operating losses to remain similar to 2025.

Current wording

We are also making significant investments in our RL efforts, including developing virtual and augmented reality devices, software for social platforms, neural interfaces, and other foundational technologies. Our RL investments include expenses relating to technology development across these efforts. Many of our RL investments are directed toward long-term, cutting-edge research and development for products that may only be fully realized in the next decade. During the six months ended June 30, 2026, our RL segment reduced our overall operating profit by approximately $8.65 billion, and we expect our full-year 2026 RL operating losses to remain similar to 2025.

Previous wording

We calculate our revenue by user geography based on our estimate of the geography in which ad impressions are delivered, virtual and digital goods are purchased, or consumer hardware products are shipped. The geography of our users affects our revenue and financial results. Our revenue in regions such as United States & Canada and Europe is relatively higher primarily due to the size and maturity of those online and mobile advertising markets, and ad impression growth is primarily in geographies that monetize at lower rates, such as Asia-Pacific. In the first quarter of 2026, revenue increased by 29% in United States & Canada, 39% in Europe, 29% in Asia-Pacific, and 40% in Rest of World, in each case relative to the same period in 2025.

Current wording

We calculate our revenue by user geography based on our estimate of the geography in which ad impressions are delivered, virtual and digital goods are purchased, or consumer hardware products are shipped. The geography of our users affects our revenue and financial results. Our revenue in regions such as United States & Canada and Europe is relatively higher primarily due to the size and maturity of those online and mobile advertising markets, and ad impression growth is primarily in geographies that monetize at lower rates, such as Asia-Pacific. In the second quarter of 2026, revenue increased by 32% in United States & Canada, 24% in Europe, 19% in Asia-Pacific, and 36% in Rest of World, in each case relative to the same period in 2025.

Previous wording

Note: Non-advertising revenue includes RL revenue generated from the delivery of consumer hardware products and FoA Other revenue, which consists of revenue from paid messaging from WhatsApp, Meta Verified subscriptions, and revenue from various other sources.

Current wording

Note: Non-advertising revenue includes RL revenue generated from the delivery of consumer hardware products and FoA Other revenue, which consists of revenue from paid messaging from WhatsApp, subscriptions, and revenue from various other sources.

Previous wording

Note: We report the numbers of DAP as specific amounts, but these numbers are estimates of the numbers of unique people using our products and are subject to statistical variances and errors. While we expect the error margin for these estimates to vary from period to period, we estimate that such margin generally will be approximately 3% of our worldwide DAP. At our scale, it is very difficult to attribute multiple user accounts within and across products to individual people, and it is possible that the actual numbers of unique people using our products may vary significantly from our estimates, potentially beyond our estimated error margins. For additional information, see the section entitled "Limitations of Key Metrics and Other Data" in this Quarterly Report on Form 10-Q. The slight decline in DAP in the first quarter of 2026 was driven by internet disruptions in Iran, as well as a restriction on access to WhatsApp in Russia.

Current wording

Note: We report the numbers of DAP as specific amounts, but these numbers are estimates of the numbers of unique people using our products and are subject to statistical variances and errors. While we expect the error margin for these estimates to vary from period to period, we estimate that such margin generally will be approximately 3% of our worldwide DAP. At our scale, it is very difficult to attribute multiple user accounts within and across products to individual people, and it is possible that the actual numbers of unique people using our products may vary significantly from our estimates, potentially beyond our estimated error margins. For additional information, see the section entitled "Limitations of Key Metrics and Other Data" in this Quarterly Report on Form 10-Q. The slight decline in DAP in the first quarter of 2026 was driven by internet disruptions in Iran (which were largely restored in the second quarter of 2026), as well as a restriction on access to WhatsApp in Russia.

Previous wording

Worldwide DAP increased 4% to 3.56 billion on average during March 2026 from 3.43 billion during March 2025.

Current wording

Worldwide DAP increased 3% to 3.60 billion on average during June 2026 from 3.48 billion during June 2025.

Previous wording

During the first quarter of 2026, worldwide ARPP was $15.66, an increase of 27% from the first quarter of 2025.

Current wording

During the second quarter of 2026, worldwide ARPP was $16.86, an increase of 24% from the second quarter of 2025.

Previous wording

Other revenue. Other revenue consists of revenue from paid messaging from WhatsApp, Meta Verified subscriptions, and revenue from various other sources.

Current wording

Other revenue. Other revenue consists of revenue from paid messaging from WhatsApp, subscriptions, and revenue from various other sources.

Previous wording

Cost of revenue. Our cost of revenue consists of expenses associated with the delivery and distribution of our products. These mainly include expenses related to the operation of our data centers and technical infrastructure, such as depreciation expense from servers, network infrastructure and buildings, employee compensation which includes payroll, share-based compensation and benefits for employees on our operations teams, energy and bandwidth costs, as well as third-party cloud costs. Cost of revenue also consists of processing fees and traffic acquisition costs, which include credit card and other fees related to processing customer transactions; RL inventory costs, which consist of cost of products sold and estimated losses on non-cancelable contractual commitments; and content and creator costs, which include payments to content creators from whom we license content for distribution, as well as incentive payments made to creators based on engagement.

Current wording

Cost of revenue. Our cost of revenue consists of expenses associated with the delivery and distribution of our products. These mainly include infrastructure expenses related to the operation of our data centers and technical infrastructure, such as depreciation expense from servers, network infrastructure and buildings, employee compensation which includes payroll, share-based compensation and benefits for employees on our operations teams, energy and bandwidth costs, as well as third-party cloud costs. Cost of revenue also consists of processing fees and traffic acquisition costs, which include credit card and other fees related to processing customer transactions; RL inventory costs, which consist of cost of products sold and estimated losses on non-cancelable contractual commitments; and content and creator costs, which include payments to content creators from whom we license content for distribution, as well as incentive payments made to creators based on engagement.

Previous wording

Research and development. Research and development expenses consist mostly of employee compensation which includes payroll, share-based compensation and benefits for our employees on our engineering and technical teams who are responsible for developing new technologies and products; infrastructure expenses, including third-party cloud costs; RL technology development costs; and facilities-related costs.

Current wording

Research and development. Research and development expenses consist mostly of employee compensation, which includes payroll, share-based compensation and benefits for our employees on our engineering and technical teams who are responsible for developing new technologies and products. Research and development expenses also include infrastructure expenses related to our data centers, technical infrastructure, and third-party cloud services; RL technology development costs; and facilities-related costs.

Previous wording

FoA revenue in the three months ended March 31, 2026 increased $14.01 billion, or 33%, compared to the same period in 2025. The increase was almost entirely driven by advertising revenue.

Current wording

FoA revenue in the three and six months ended June 30, 2026 increased $13.22 billion, or 28%, and $27.23 billion, or 31%, respectively, compared to the same periods in 2025. The increases were almost entirely driven by advertising revenue.

Previous wording

Advertising revenue in the three months ended March 31, 2026 increased $13.63 billion, or 33%, compared to the same period in 2025, due to increases in ad impressions delivered and average price per ad. During the three months ended March 31, 2026, ad impressions delivered increased by 19%, year-over-year, as compared with an increase of 5% in the same period in 2025. Ad impressions delivered during the three months ended March 31, 2026 grew in all regions, especially in Asia-Pacific, which was driven by increases in users and their engagement as well as the frequency of ads shown on our products. During the three months ended March 31, 2026, the average price per ad increased by 12%, year-over-year, as compared with an increase of 10% in the same period in 2025. The increase in average price per ad in the three months ended March 31, 2026 was driven by an increase in advertising demand, which we believe is mostly due to ongoing improvements to our ad performance from our ad targeting and measurement tools, and a favorable foreign currency exchange impact. This increase was partially offset by a higher number of ad impressions delivered, especially in geographies and in products, such as Reels, that monetize at lower rates. Other factors are discussed in the section entitled "—Executive Overview of First Quarter Results." In addition, the online commerce vertical was the largest contributor to the increase in advertising revenue in the three months ended March 31, 2026 compared to the same period in 2025. We anticipate that future advertising revenue will be driven by a combination of price and ad impressions delivered.

Current wording

Advertising revenue in the three and six months ended June 30, 2026 increased $12.80 billion, or 27%, and $26.43 billion, or 30%, respectively, compared to the same periods in 2025, due to increases in ad impressions delivered and average price per ad. During the three and six months ended June 30, 2026, ad impressions delivered increased by 14% and 16%, respectively, year-over-year, as compared with increases of 11% and 8%, respectively, in the same periods in 2025. Ad impressions delivered during the three and six months ended June 30, 2026 grew in all regions, especially in Asia-Pacific, which was driven by increases in users and their engagement as well as the frequency of ads shown on our products. During the three and six months ended June 30, 2026, the average price per ad increased by 12% in both periods, year-over-year, as compared with increases of 9% and 10%, respectively, in the same periods in 2025. The increases in average price per ad in the three and six months ended June 30, 2026 were driven by an increase in advertising demand, which we believe is mostly due to ongoing improvements to our ad performance from our ad targeting and measurement tools, and a favorable foreign currency exchange impact. These increases were partially offset by a higher number of ad impressions delivered, especially in geographies and in products, such as Reels, that monetize at lower rates. Other factors are discussed in the section entitled "—Executive Overview of Second Quarter Results." In addition, the online commerce vertical was the largest contributor to the increase in advertising revenue in the three and six months ended June 30, 2026 compared to the same periods in 2025. We anticipate that future advertising revenue will be driven by a combination of price and ad impressions delivered.

Previous wording

FoA other revenue in the three months ended March 31, 2026 increased $375 million, or 74%, compared to the same period in 2025. The increase was mostly driven by paid messaging from WhatsApp and Meta Verified subscriptions.

Current wording

FoA other revenue in the three and six months ended June 30, 2026 increased $424 million, or 73%, and $798 million, or 73%, respectively, compared to the same periods in 2025. The increases were primarily driven by paid messaging from WhatsApp and subscriptions.

Previous wording

RL revenue in the three months ended March 31, 2026 decreased $10 million, or 2%, compared to the same period in 2025. The decrease was driven by lower Meta Quest sales, offset by an increase in sales of AI glasses.

Current wording

RL revenue in the three and six months ended June 30, 2026 increased $61 million, or 16%, and $51 million, or 7%, respectively, compared to the same periods in 2025. The increases were driven by higher sales of AI glasses, partially offset by lower Meta Quest sales.

Previous wording

Changes in foreign exchange rates had a favorable impact on our revenue in the three months ended March 31, 2026 compared to the same period in 2025. To calculate revenue on a constant currency basis, we translated revenue using the prior year's monthly exchange rates for our settlement or billing currencies other than the U.S. dollar. Using these constant rates for the three months ended March 31, 2026, our total revenue and advertising revenue would have been $54.56 billion and $53.29 billion, which were $1.75 billion and $1.73 billion lower than actual total revenue and advertising revenue, respectively.

Current wording

Changes in foreign exchange rates had a favorable impact on our revenue in the three and six months ended June 30, 2026 compared to the same periods in 2025. To calculate revenue on a constant currency basis, we translated revenue using the prior year's monthly exchange rates for our settlement or billing currencies other than the U.S. dollar. Using these constant rates, for the three months ended June 30, 2026, our total revenue and advertising revenue would have been

Previous wording

FoA income from operations in the three months ended March 31, 2026 increased $5.14 billion, or 24%, compared to the same period in 2025. The increase in FoA income from operations was driven by higher advertising revenue which was partially offset by an increase in costs and expenses. The increase in costs and expenses was mainly due to increases in infrastructure costs and employee compensation.

Current wording

FoA income from operations in the six months ended June 30, 2026 increased $3.56 billion, or 8%, compared to the same period in 2025. The increase in FoA income from operations was driven by higher advertising revenue which was offset by an increase in costs and expenses. The increase in costs and expenses was primarily due to increases in employee compensation, including severance expenses; infrastructure expenses related to our data centers, technical infrastructure, and third-party cloud services; legal-related costs; and third-party AI token costs.

Previous wording

RL loss from operations in the three months ended March 31, 2026 decreased $182 million, or 4%, compared to the same period in 2025, driven by lower RL costs and expenses. RL costs and expenses decreased primarily due to a decrease in employee compensation.

Current wording

RL loss from operations in the six months ended June 30, 2026 decreased $92 million, or 1%, compared to the same period in 2025, driven by an increase in revenue and lower RL costs and expenses.

Previous wording

Our provision for income taxes in the three months ended March 31, 2026 decreased $6.76 billion compared to the same period in 2025, mostly due to a decrease in the effective tax rate. Our effective tax rate in the three months ended March 31, 2026 decreased compared to the same period in 2025, primarily due to Treasury Notice 2026-7, as described above.

Current wording

Our provision for income taxes in the three months ended June 30, 2026 increased $711 million, or 32%, compared to the same period in 2025, primarily due to an increase in the effective tax rate. Our effective tax rate increased in the three months ended June 30, 2026 compared to the same period in 2025, primarily due to certain tax benefits such as U.S. tax benefits from foreign-derived deduction eligible income and excess tax benefits from share-based compensation being limited by the Corporate Alternative Minimum Tax (CAMT) regime in 2026.

Previous wording

Absent any changes to our tax landscape, we expect our effective tax rate for the remaining quarters of 2026 to be between 13-16%.

Current wording

Absent any changes to our tax landscape, we expect our effective tax rate for the remaining quarters of 2026 to be between 15-17%.

Previous wording

Our principal sources of liquidity are our cash, cash equivalents, marketable securities, and cash generated from operations. Cash, cash equivalents, and marketable securities are comprised of cash on deposit with banks, time deposits, money market funds, U.S. government and agency securities, investment grade corporate debt securities, and marketable equity securities. As part of our cash management strategy, we concentrate cash deposits with large financial institutions and our investment holdings are in diversified highly rated securities. Cash, cash equivalents, and marketable securities were $81.18 billion as of March 31, 2026, a decrease of $412 million from December 31, 2025. The decrease was primarily due to $19.84 billion of capital expenditures, which includes purchases of property and equipment and principal payments on finance leases; $4.42 billion of taxes paid related to net share settlement of employee restricted stock unit (RSU) awards; $1.57 billion of net unrealized losses on marketable equity securities; $1.35 billion of payments of dividends and dividend equivalents; and $372 million of acquired intangible assets. These decreases were offset by $32.23 billion of cash generated from operations.

Current wording

Our principal sources of liquidity are our cash, cash equivalents, marketable securities, and cash generated from operations. Cash, cash equivalents, and marketable securities are comprised of cash on deposit with banks, time deposits, money market funds, U.S. government and agency securities, investment grade corporate debt securities, and marketable equity securities. As part of our cash management strategy, we concentrate cash deposits with large financial institutions and our investment holdings are in diversified highly rated securities.

Previous wording

In addition, during the quarter ended March 31, 2026, we reclassified $5.00 billion of unrestricted money market funds to restricted cash equivalents related to the terms of a multi-year purchase agreement. These funds are restricted from general corporate use and are expected to be released upon satisfying the underlying purchase obligations. For additional information regarding restricted cash equivalents, see Note 4 — Financial Instruments.

Current wording

In addition, during the six months ended June 30, 2026, $10.80 billion of unrestricted money market funds was reclassified as restricted cash equivalents in connection with escrow requirements under certain multi-year infrastructure purchase agreements. These funds are restricted from general corporate use and are expected to be released between 2028 and 2030 upon satisfying the underlying purchase obligations. See Note 4 — Financial Instruments in the notes to the condensed consolidated financial statements included in Part I, Item 1, of this Quarterly Report on Form 10-Q for additional information.

Previous wording

Cash provided by operating activities during the three months ended March 31, 2026 primarily consisted of $26.77 billion net income adjusted for certain non-cash items, such as $6.03 billion of share-based compensation expense and $6.00 billion of depreciation and amortization expense. The increase in cash flows from operating activities during the three months ended March 31, 2026, compared to the same period in 2025, was due to an increase in cash collections from our customers driven by the increase in revenue, partially offset by higher operational spending.

Current wording

Cash provided by operating activities during the six months ended June 30, 2026 mostly consisted of $42.62 billion net income adjusted for certain non-cash items, such as $13.69 billion of share-based compensation expense and $12.35 billion of depreciation and amortization expense. The increase in cash flows from operating activities during the six months ended June 30, 2026, compared to the same period in 2025, was due primarily to an increase in cash collections from our customers driven by higher revenue, and a decrease in cash tax payments, partially offset by higher operational spending.

Previous wording

Cash used in investing activities during the three months ended March 31, 2026 mostly consisted of $19.00 billion of purchases of property and equipment as we continued to invest in servers, data centers, and network infrastructure, and $13.80 billion of net purchases of marketable securities. The increase in cash used in investing activities during the three months ended March 31, 2026, compared to the same period in 2025, was mostly due to increases in net purchases of marketable securities and cash paid for property and equipment.

Current wording

Cash used in investing activities during the six months ended June 30, 2026 mostly consisted of $49.11 billion of purchases of property and equipment as we continued to invest in servers, data centers, and network infrastructure, and $31.56 billion of net purchases of marketable securities. The increase in cash used in investing activities during the six months ended June 30, 2026, compared to the same period in 2025, was mostly due to increases in net purchases of marketable securities and property and equipment, partially offset by a decrease in non-marketable equity investments.

Previous wording

We anticipate making capital expenditures of approximately $125 billion to $145 billion in 2026 to support our AI efforts and core business.

Current wording

We anticipate making capital expenditures of approximately $130 billion to $145 billion in 2026 to support our AI efforts and core business.

Previous wording

Cash used in financing activities during the three months ended March 31, 2026 primarily consisted of $4.42 billion of taxes paid related to net share settlement of RSUs, and $1.35 billion of payments of dividends and dividend equivalents. The decrease in cash used in financing activities during the three months ended March 31, 2026, compared to the same period in 2025, was mostly due to a decrease in share repurchases.

Current wording

Cash provided by financing activities during the six months ended June 30, 2026 mainly consisted of $24.91 billion net proceeds from the issuance of the Notes in May 2026, partially offset by $8.70 billion of taxes paid related to net share settlement of RSUs, and $2.70 billion of payments of dividends and dividend equivalents. The increase in cash provided by financing activities during the six months ended June 30, 2026, compared to the same period in 2025, was mostly due to net proceeds from the May 2026 Notes and the absence of share repurchases in the current period.

Previous wording

In addition to the lease liabilities included in our condensed consolidated balance sheets, we have operating and finance leases that have not yet commenced as of March 31, 2026. These lease obligations were approximately $182.88 billion, consisting of data centers, colocations, and certain network infrastructure, which will commence during the remainder of 2026 and 2036 with lease terms ranging from greater than one year to 30 years.

Current wording

In addition to the lease liabilities included in our condensed consolidated balance sheets, we have operating and finance leases that have not yet commenced as of June 30, 2026. These lease obligations were approximately $278.99 billion, consisting of data centers, colocations, and certain network infrastructure, which will commence during the remainder of 2026 through 2036 with lease terms ranging from greater than one year to 30 years. In July 2026, we entered into additional data center leases with lease obligations of approximately $68 billion, which are expected to commence in 2027 and 2028, with lease terms of 18 to 20 years.

Previous wording

As of March 31, 2026, we had $237.67 billion of non-cancelable contractual commitments, comprising both short-term and long-term arrangements. These commitments are mostly related to third-party cloud capacity arrangements and continued investments in servers and network infrastructure, data centers, and consumer hardware products in Reality Labs, with approximately $42.25 billion and $47.65 billion due in 2026 and 2027, respectively. In addition, as of March 31, 2026, we have contingent obligations to purchase up to $14.72 billion of cloud capacity over a five-year period, which may be reduced if the cloud service provider is able to sell such capacity to other customers. In April 2026, we entered into additional multi-year infrastructure contracts, related to which our non-cancelable contractual commitments increased by approximately $24 billion.

Current wording

As of June 30, 2026, we had $349.31 billion of non-cancelable contractual commitments, comprising both short-term and long-term arrangements. These commitments mostly relate to third-party cloud capacity arrangements and investments in servers and network infrastructure, data centers, and consumer hardware products in Reality Labs, with approximately $53.52 billion and $81.65 billion due in 2026 and 2027, respectively. In addition, as of June 30, 2026, we have contingent obligations to purchase up to $14.72 billion of cloud capacity over a five-year period, which may be reduced if the cloud service provider is able to sell such capacity to other customers. For agreements with variable terms, we do not estimate the total obligation beyond minimum quantities and/or pricing, as of the reporting date.

Previous wording

In connection with certain contractual restrictions under a multi-year purchase agreement, we reclassified $5.00 billion of money market funds as restricted cash equivalents as of March 31, 2026. These funds are restricted from general corporate use and are expected to be released upon satisfying the underlying purchase obligations. For additional information regarding restricted cash equivalents, see Note 4 — Financial Instruments.

Current wording

In connection with escrow requirements under certain multi-year infrastructure purchase agreements, $10.80 billion of money market funds was reclassified as restricted cash equivalents as of June 30, 2026. These funds are restricted from general corporate use and are expected to be released between 2028 and 2030 upon satisfying the underlying purchase obligations.

Previous wording

As of March 31, 2026, we had outstanding long-term debt in the form of senior unsecured notes for an aggregate principal amount of $59.00 billion, which mature from 2027 through 2065. Short-term and long-term future interest payments obligations as of March 31, 2026 were $2.98 billion and $56.27 billion, respectively.

Current wording

As of June 30, 2026, we had $84.00 billion aggregate principal amount of Notes outstanding, which mature from 2027 through 2066. Short-term and long-term future interest payments obligations as of June 30, 2026 were $4.40 billion and $84.98 billion, respectively.

Previous wording

Our board of directors has authorized a share repurchase program of our Class A common stock, which commenced in January 2017 and does not have an expiration date. We did not repurchase any shares of Class A common stock during the three months ended March 31, 2026. As of March 31, 2026, $25.03 billion remained available and authorized for repurchases. Our share repurchase program may be suspended, delayed, discontinued, or accelerated at any time.

Current wording

Our board of directors has authorized a share repurchase program of our Class A common stock, which commenced in January 2017 and does not have an expiration date. We did not repurchase any shares of Class A common stock during the six months ended June 30, 2026. As of June 30, 2026, $25.03 billion remained available and authorized for repurchases. Our share repurchase program may be suspended, delayed, discontinued, or accelerated at any time.