Meta shares slide as AI spending crushes free cash flow despite revenue beat

4:05 PM ET · July 30, 2026

Meta’s second quarter results, released Wednesday, showed the tension between strong top line growth and the cost of its AI ambitions. Revenue rose 28 percent from a year earlier to $60.8 billion, edging past the roughly $60.2 billion analysts expected, but earnings of $6.18 a share missed estimates near $7.10, and free cash flow collapsed 91 percent to just $784 million from $8.55 billion a year earlier as AI infrastructure spending reached about $31 billion in the quarter alone. Total expenses climbed 55 percent to $42.0 billion. Meta narrowed its full year capital expenditure guidance to a range of $130 billion to $145 billion and forecast third quarter revenue at a midpoint of about $62.5 billion, below the roughly $63.2 billion Wall Street had modeled. Shares fell about 10 percent in extended trading as investors weighed the revenue beat against the margin compression and the sharp drop in cash generation. The report lands the same week Meta unveiled its $14 billion data center joint venture with BlackRock, underscoring how much of the company’s cash is now tied up in AI infrastructure commitments, and adds to pressure on chief executive Mark Zuckerberg to show that the spending is translating into revenue rather than just capacity.