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 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.

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 nine months ended September 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 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.

Current wording

Our financial results and key Family metrics for the third quarter of 2026 are set forth below. Total revenue for the third quarter of 2026 was $64.60 billion, an increase of 26% compared to the third quarter of 2025, due to an increase in advertising revenue. Ad impressions delivered across our Family of Apps in the third quarter of 2026 increased 10% year-over-year, and our average price per ad in the third quarter of 2026 increased 14% year-over-year.

Previous 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.

Current wording

Income from operations for the third quarter of 2026 was $12.99 billion, a decrease of $7.55 billion, or 37%, compared to the third quarter of 2025, driven by higher costs and expenses. The increase in costs and expenses was primarily due to increases in legal-related costs, including the $9.89 billion charge related to the August 2026 multistate attorneys general agreement; infrastructure expenses related to our data centers, technical infrastructure, and third-party cloud services; and third-party AI token costs.

Previous wording

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

Current wording

•Net income was $9.86 billion, with diluted earnings per share (EPS) of $3.83 for the three months ended September 30, 2026.

Previous wording

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

Current wording

•Capital expenditures, including principal payments on finance leases, were $34.91 billion for the three months ended September 30, 2026.

Previous wording

•Dividend and dividend equivalent payments were $1.35 billion for the three months ended June 30, 2026.

Current wording

•Dividend and dividend equivalent payments were $1.36 billion for the three months ended September 30, 2026.

Previous wording

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

Current wording

•Family daily active people (DAP) was 3.64 billion on average for September 2026, an increase of 3% year-over-year.

Previous wording

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

Current wording

•Ad impressions delivered across our Family of Apps in the third quarter of 2026 increased by 10% 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. 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.

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.

Previous 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.

Current wording

We remain focused on operating efficiently while investing in significant opportunities. In the nine months ended September 30, 2026, 89% of our total costs and expenses were recognized in FoA and 11% 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, agentic 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. For example, we have launched Muse, an agentic AI, which we intend to scale over time. 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 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.

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 nine months ended September 30, 2026, our RL segment reduced our overall operating profit by approximately $12.78 billion, and we expect our full-year 2026 RL operating losses to be approximately $18 billion to $19 billion.

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 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.

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 third quarter of 2026, revenue increased by 33% in United States & Canada, 18% in Europe, 16% in Asia-Pacific, and 34% in Rest of World, in each case relative to the same period in 2025.

Previous wording

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

Current wording

Worldwide DAP increased 3% to 3.64 billion on average during September 2026 from 3.54 billion during September 2025.

Previous wording

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

Current wording

During the third quarter of 2026, worldwide ARPP was $17.72, an increase of 23% from the third quarter of 2025.

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. 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.

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; third-party AI token costs; RL technology development costs; and facilities-related costs.

Previous wording

Marketing and sales. Marketing and sales expenses consist mostly of employee compensation which includes payroll, share-based compensation and benefits for our employees engaged in sales, sales support, marketing, business development, and customer service functions; professional services to support our community and product operations; and marketing and promotional expenses.

Current wording

Marketing and sales. Marketing and sales expenses consist mostly of employee compensation which includes payroll, share-based compensation and benefits for our employees engaged in sales, sales support, marketing, business development, and customer service functions; marketing and promotional expenses; professional services to support our community and product operations; and third-party AI token costs.

Previous 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.

Current wording

FoA revenue in the three and nine months ended September 30, 2026 increased $13.39 billion, or 26%, and $40.62 billion, or 29%, respectively, compared to the same periods in 2025. The increases were almost entirely driven by advertising revenue.

Previous 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.

Current wording

Advertising revenue in the three and nine months ended September 30, 2026 increased $12.98 billion, or 26%, and $39.41 billion, or 29%, respectively, compared to the same periods in 2025, due to increases in ad impressions delivered and average price per ad. During the three and nine months ended September 30, 2026, ad impressions delivered increased by 10% and 14%, respectively, year-over-year, as compared with increases of 14% and 10%, respectively, in the same periods in 2025. Ad impressions delivered during the three and nine months ended September 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 nine months ended September 30, 2026, the average price per ad increased by 14% and 13%, respectively, year-over-year, as compared with increases of 10% in both periods in 2025. The increases in average price per ad in the three and nine months ended September 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. A favorable foreign currency exchange impact also contributed to the increase in the nine months ended September 30, 2026. 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 Third Quarter Results." In addition, the online commerce vertical was the largest contributor to the increase in advertising revenue in the three and nine months ended September 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 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.

Current wording

FoA other revenue in the three and nine months ended September 30, 2026 increased $407 million, or 59%, and $1.20 billion, or 67%, 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 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.

Current wording

RL revenue in the three months ended September 30, 2026 decreased $27 million, or 6%, compared to the same period in 2025. The decrease was driven by lower Meta Quest sales, partially offset by higher sales of AI glasses.

Previous wording

RL loss from operations in the three months ended June 30, 2026 increased $89 million, or 2%, compared to the same period in 2025, driven by higher RL costs and expenses partially offset by an increase in revenue.

Current wording

RL revenue in the nine months ended September 30, 2026 increased $24 million, or 2%, compared to the same period in 2025. The increase was 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 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

Current wording

Changes in foreign exchange rates had an unfavorable impact on our revenue in the three months ended September 30, 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 September 30, 2026, our total revenue and advertising revenue would have been $64.71 billion and $63.16 billion, which were $113 million and $96 million higher than actual total revenue and advertising revenue, respectively.

Previous wording

Cost of revenue in the three and six months ended June 30, 2026 increased $2.84 billion, or 33%, and $5.49 billion, or 34%, respectively, compared to the same periods in 2025. The increases were primarily due to higher infrastructure expenses related to our data centers, technical infrastructure, and third-party cloud services.

Current wording

Cost of revenue in the three and nine months ended September 30, 2026 increased $4.16 billion, or 45%, and $9.65 billion, or 38%, respectively, compared to the same periods in 2025. The increases were primarily due to higher infrastructure expenses related to our data centers, technical infrastructure, and third-party cloud services.

Previous wording

The higher employee compensation was mainly from increases in share-based compensation expense and severance expenses during the three and six months ended June 30, 2026.

Current wording

The higher employee compensation was mainly from increases in share-based compensation expense during the three and nine months ended September 30, 2026, partially offset by a 16% decrease in employee headcount in our engineering and other technical functions.

Previous wording

See Note 9 — Commitments and Contingencies 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 regarding legal-related costs.

Current wording

See Note 8 — Liabilities and Note 10 — Commitments and Contingencies 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 regarding legal-related costs.

Previous wording

FoA income from operations in the three months ended June 30, 2026 decreased $1.58 billion, or 6%, compared to the same period in 2025, driven by higher FoA costs and expenses partially offset by an increase in revenue. 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.

Current wording

FoA income from operations in the three and nine months ended September 30, 2026 decreased $7.85 billion, or 31%, and $4.29 billion, or 6%, respectively, compared to the same periods in 2025, driven by higher FoA costs and expenses partially offset by an increase in revenue. The increases in costs and expenses were mostly due to increases in infrastructure expenses related to our data centers, technical infrastructure, and third-party cloud services; legal-related costs; employee compensation in our engineering and other technical functions; and third-party AI token costs.

Previous wording

•Interest expense in the three and six months ended June 30, 2026, increased $542 million, or 225%, and $864 million, or 180%, respectively, compared to the same periods in 2025, due to higher long-term debt balances.

Current wording

•Interest expense in the three and nine months ended September 30, 2026, increased $750 million, or 330%, and $1.61 billion, or 228%, respectively, compared to the same periods in 2025, due to higher long-term debt balances.

Previous wording

See Note 4 — Financial Instruments and Note 5 — Non-Marketable Equity Investments 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 regarding unrealized losses on our marketable equity securities and unrealized gains on our non-marketable equity investments, respectively.

Current wording

See Note 4 — Financial Instruments, Note 5 — Non-Marketable Equity Investments, and Note 9 — Long-term Debt 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 regarding unrealized losses on our marketable equity securities, unrealized gains on our non-marketable equity investments, and long-term debt, respectively.

Previous wording

Our provision for income taxes in the six months ended June 30, 2026 decreased $6.05 billion, or 154%, compared to the same period in 2025, primarily due to the income tax benefit from U.S. Treasury Notice 2026-7, which provided relief from the CAMT related to the expensing of previously capitalized U.S. research and development costs.

Current wording

Provision for income taxes and our effective tax rate in the nine months ended September 30, 2026 decreased compared to the same period in 2025, mostly due to the effects of the enactment of the OBBBA in the third quarter of 2025 and U.S. Treasury Notice 2026-7, issued in the first quarter of 2026, which provided relief from the Corporate Alternative Minimum Tax (CAMT) for previously capitalized U.S. research and development costs, partially offset by the non-deductible portion of the August 2026 multistate attorneys general agreement charge.

Previous wording

Effective Tax Rate Items. Our effective tax rate in the future will depend upon the proportion between the following items and income before provision for income taxes: the effects of changes in tax law, changes in valuation allowance due to the effects of CAMT, U.S. tax benefits from foreign-derived deduction eligible income, tax effects from share-based compensation, research tax credit, tax effects from capital losses not expected to be utilized, settlement of tax contingency items, and tax effects of changes in our business.

Current wording

Effective Tax Rate Items. Our effective tax rate in the future will depend upon the proportion between the following items and income before provision for income taxes: the effects of changes in tax law, changes in valuation allowance due to the effects of CAMT, U.S. tax benefits from foreign-derived deduction eligible income, tax effects from share-based compensation, research tax credit, tax effects of charges related to legal proceedings, tax effects from capital losses not expected to be utilized, settlement of tax contingency items, and tax effects of changes in our business.

Previous 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%.

Current wording

Absent any changes to our tax landscape, we expect our fourth quarter 2026 effective tax rate to be between 15-17%.

Previous wording

Cash, cash equivalents, and marketable securities were $90.26 billion as of June 30, 2026, an increase of $8.67 billion from December 31, 2025. The increase was due to $64.09 billion of cash generated from operations and $24.91 billion of net proceeds from the issuance of fixed-rate senior unsecured notes (the Notes) in May 2026. These increases were partially offset by $50.92 billion of capital expenditures, which includes purchases of property and equipment and principal payments on finance leases; $8.70 billion of taxes paid related to net share settlement of employee restricted stock unit (RSU) awards; $2.70 billion of payments of dividends and dividend equivalents; and $2.29 billion of cash used in other financing activities.

Current wording

Cash, cash equivalents, and marketable securities were $82.45 billion as of September 30, 2026, an increase of $857 million from December 31, 2025. The increase was mainly due to $96.87 billion of cash generated from operations and $24.91 billion of net proceeds from the issuance of fixed-rate senior unsecured notes (the Notes) in May 2026. These increases were partially offset by $85.82 billion of capital expenditures, which includes purchases of property and equipment and principal payments on finance leases; $12.77 billion of taxes paid related to net share settlement of employee restricted stock unit (RSU) awards; $4.06 billion of payments of dividends and dividend equivalents; and $2.63 billion of cash used in other financing activities.

Previous 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.

Current wording

In addition, during the nine months ended September 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 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.

Current wording

Cash provided by operating activities during the nine months ended September 30, 2026 mostly consisted of $52.48 billion net income adjusted for certain non-cash items, such as $21.05 billion of share-based compensation expense and $19.51 billion of depreciation and amortization expense. The increase in cash flows from operating activities during the nine months ended September 30, 2026, compared to the same period in 2025, was primarily due 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 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.

Current wording

Cash used in investing activities during the nine months ended September 30, 2026 mostly consisted of $83.06 billion of purchases of property and equipment as we continued to invest in servers, data centers, and network infrastructure, and $28.63 billion of net purchases of marketable securities. The increase in cash used in investing activities during the nine months ended September 30, 2026, compared to the same period in 2025, was mostly due to increases in purchases of property and equipment and marketable securities, partially offset by a decrease in non-marketable equity investments.

Previous wording

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

Current wording

We anticipate making capital expenditures of approximately $135 billion to $145 billion in 2026 to support our AI efforts and core business.

Previous 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.

Current wording

Cash provided by financing activities during the nine months ended September 30, 2026 consisted of $24.91 billion net proceeds from the issuance of the Notes in May 2026, partially offset by $12.77 billion of taxes paid related to net share settlement of RSUs, $4.06 billion of payments of dividends and dividend equivalents, $2.77 billion of principal payments on finance leases, and $2.63 billion of cash used in other financing activities. The increase in cash provided by financing activities during the nine months ended September 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

We currently anticipate that our available funds and cash flow from operations and financing activities will be sufficient to meet our operational cash needs and fund our cash commitments for investing and financing activities, including investments in infrastructure and AI initiatives, as well as any return of capital to stockholders over the next 12 months and thereafter for the foreseeable future. We have increased investments in infrastructure and AI initiatives and expect to continue to do so. From time to time we may also seek to raise additional capital through debt, equity, or other financing arrangements. We continuously evaluate our liquidity and capital resources, including our access to external capital, to ensure we can finance our future capital requirements.

Current wording

We currently anticipate that our available funds and cash flow from operations and financing activities will be sufficient to meet our operational cash needs and fund our cash commitments for investing and financing activities, including investments in infrastructure and AI initiatives, as well as any return of capital to stockholders over the next 12 months and thereafter for the foreseeable future. We have increased investments in infrastructure and AI initiatives and expect to continue to do so. From time to time we expect to seek to raise additional capital through debt, equity, or other financing arrangements. We continuously evaluate our liquidity and capital resources, including our access to external capital, to ensure we can finance our future capital requirements.

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 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.

Current wording

In addition to the lease liabilities included on our condensed consolidated balance sheets, we have operating and finance leases that have not yet commenced as of September 30, 2026. These lease obligations were approximately $355.73 billion, consisting of data centers, energy-related infrastructure, 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.

Previous 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.

Current wording

As of September 30, 2026, we had $454.52 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, energy service agreements for data centers, and consumer hardware products in Reality Labs, with approximately $45.85 billion and $121.41 billion due in 2026 and 2027, respectively. In addition, as of September 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.