Meta Platforms, Inc. Q4 FY2025 earnings call

AI Acceleration

• Expect 2026 to be a year of further AI acceleration with new models and products rolling out. Focus on personal superintelligence, merging LLMs with recommendation systems, agentic shopping tools, new immersive media formats, and glasses with sales tripling last year.

Business Performance

• Revenue driven by engaging experiences and monetization. Q4 optimizations led to 7% lift in organic feed/video views on Facebook and 20% time spent lift on Threads. Investments in AI for recommendation systems, ads (e.g., new runtime model on Instagram driving 3% conversion rate increase), and business tools (e.g., Meta AI business assistant testing).

Workforce and Infrastructure

• Ended Q4 with over 78,800 employees, up 6% year over year. Focus on MetaCompute for infrastructure efficiency, including investing in silicon, energy, and optimizing technology and supply chain to reduce cost per gigawatt.

Family of apps: Q4 total revenue was $58.9 billion, up 25% year over year. Q4 family of apps ad revenue was $58.1 billion, up 24% or 23% on a constant currency basis. Family of apps other revenue was $801 million, up 54%, driven by WhatsApp paid revenue growth and MetaVerified subscriptions. Reality Labs: Q4 revenue was $955 million, down 12% year over year, due to lapping the introduction of Quest 3s in 2024 and retail partners procuring Quest headsets, along with legal and infrastructure expense growth.

Revenue

• Expect Q1 2026 total revenue to be in the range of $53.5 billion to $56.5 billion, with foreign currency providing approximately 4% tailwind.

Expenses and CapEx

• Full-year 2026 total expenses expected to be $162 to $169 billion, driven by infrastructure and compensation. CapEx expected $115 to $135 billion.

Operating Income

• Expect 2026 operating income to be above 2025, tax rate 13%-16%.

Legal and Regulatory

• Monitor headwinds in EU and US, including scrutiny on youth-related issues and potential material losses from trials scheduled in the US.

Q: Brian Thomas Nowak asks Mark about long-term AI revenue opportunities and Susan about near-term revenue drivers in 2026.

A: Mark gives high-level on AI opportunities, Susan talks about Q1 guidance and ad growth drivers.

Q: Eric James Sheridan asks about compute capacity and ads scaling.

A: Susan discusses infrastructure efficiency and how larger models benefit ads performance.

Q: Mark Elliott Shmulik asks about product impact timeline and operating income growth.

A: Mark talks about rolling out products over the year, Susan clarifies operating income is absolute dollars above 2025.

Q: Douglas Till Anmuth asks about MSL progress and free cash flow.

A: Mark is optimistic about MSL but not specific, Susan talks about infrastructure investments and flexibility.

Q: Justin Post asks about opportunities beyond ads and e-commerce acceleration.

A: Mark mentions focus on beyond ads while ads is key, Susan talks about e-commerce growth in Q4.

Q: Ronald Victor Josey asks about ranking recommendation model roadmap.

A: Susan discusses multiple optimizations in engagement and ads, plans to scale models and use LLMs.

Q: Mark Stephen Mahaney asks about Meta AI engagement and share repurchase.

A: Susan gives Meta AI update on markets and usage, clarifies no immediate share repurchase plans