Meta reported its Q2 earnings with an EPS of $6.18 on $60.8 billion in revenue, missing EPS expectations of $7.14 but surpassing revenue estimates. Following the announcement, Meta's stock dropped nearly 8%. The firm's advertising revenue was slightly higher than anticipated, at $59.3 billion. Meta also increased its capital expenditure estimates to a range of $135 billion to $145 billion, primarily for data center investments. Additionally, Meta announced a joint venture with BlackRock to build a $14 billion data center in Texas, with Meta owning 20% of the project. Furthermore, the company launched its Musk Spark 1.1 AI model with a competitive pricing strategy aimed at capturing market share from major AI providers.

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Meta misses on Q2 earnings, stock tumbles

Daniel Howley· Technology Editor

Wed, July 29, 2026 at 4:05 PM EDT2 min read

Meta ( META) reported its second quarter results after the bell on Wednesday, missing on earnings per share (EPS) but beating on revenue. The company also narrowed its planned capital expenditure range for 2026.

Meta stock fell nearly 8% immediately following the results.

585.61 -7.80 (-1.31%)

At close: 4:00:01 PM EDT

For the quarter, Meta saw (EPS) of $6.18 on revenue of $60.8 billion. Analysts were anticipating EPS of $7.14 and revenue of $60.2 billion, based on Bloomberg consensus estimates.

The company reported EPS of $7.14 and revenue of $47.51 billion in the same period a year ago.

Meta's advertising revenue came in at $59.3 billion versus expectations of $59.07 billion.

Importantly, the company raised the bottom line of its capital expenditure estimates, increasing them to between $135 billion and $145 billion from between $125 to $145 billion.

The company has said it plans to spend upward of $145 billion this year, with the bulk of that going to its data center build-out.

The Meta logo is displayed on a smartphone screen placed on a reflective surface onto which the Meta AI logo is projected, in Creteil, France, on July 9, 2026. Meta announces the launch of Muse Image, its first proprietary image generation model. (Photo by Samuel Boivin/NurPhoto via Getty Images)·NurPhoto via Getty Images

On Tuesday, Meta and BlackRock announced they are entering into an agreement to build a $14 billion, 1-gigawatt data center in Texas. BlackRock will hold an 80% stake in the site, while Meta will get the remaining 20%.

Earlier this month, Zuckerberg told Bloomberg that it makes sense for the company to explore leasing out some of its data center capacity to customers.

It's not clear how Meta would structure any deals, but it could turn toward SpaceX ( SPCX) for inspiration. That company has set up multibillion-dollar arrangements to rent access to its AI capacity to Anthropic ( ANTH.PVT) and Google ( GOOG, GOOGL).

585.61 -7.80 (-1.31%)

At close: 4:00:01 PM EDT

Meta could also choose to operate similarly to a neocloud company like CoreWeave and simply rent out its hardware as is.

The company also debuted its new Musk Spark 1.1 model this month and revealed an aggressive pricing scheme that significantly undercuts the cost of using models from OpenAI and Anthropic.

Meta charges developers $1.25 per million input tokens and $4.25 per million output tokens. Anthropic currently charges $5 per million input tokens and $25 per million output tokens for its Opus 4.8 model, which Meta compares with Spark 1.1.

By setting prices so low, Meta could take market share from the big AI labs as price-conscious customers seek better deals on AI models.

Email Daniel Howley at dhowley@yahoofinance.com. Follow him on X at @DanielHowley .

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