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Meta Reports 5% Revenue Growth to $34.14B, Surpassing Consensus Slightly

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  Published in Stocks and Investing on Wednesday, November 12th 2025 at 11:40 GMT by Seeking Alpha

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Revenue and earnings overview

Meta’s total revenue for the quarter was $34.14 billion, up 5 percent year‑over‑year (YoY) but only 1.5 percent above the consensus estimate of $33.68 billion. The bulk of the increase came from advertising, which accounted for $32.70 billion of revenue, up 6 percent YoY. The company reported earnings per share (EPS) of $1.73, beating the consensus of $1.54.

Management explained that the modest YoY revenue growth was largely driven by higher ad spend in the U.S. and European markets, as well as a slight rebound in inventory supply for small‑business advertisers. The advertising business also benefited from the rollout of Meta’s “Creator Marketplace” and its AI‑enhanced ad‑creation tools, which have reportedly helped advertisers increase click‑through rates and return on ad spend (ROAS).

User metrics and engagement

Daily active users (DAU) across Facebook, Instagram, Messenger, and WhatsApp grew 3 percent YoY to 3.01 billion, while monthly active users (MAU) reached 3.32 billion, up 4 percent. The company noted that “organic engagement” on the platform—measured as the average time spent per user—remained steady, but the share of that time spent on video content had increased from 27 percent to 32 percent.

Meta’s CEO, Mark Zuckerberg, pointed out that Meta’s “video‑first” strategy was now paying off, with over 8 billion daily video views on Instagram alone. However, the article stresses that the platform’s ad‑driven business model remains vulnerable to shifts in consumer attention and competing platforms such as TikTok and YouTube, which are also investing heavily in video ads.

Spending on AI and tech infrastructure

One of the most prominent themes in the earnings call was Meta’s continued “heavy” spend on AI and data‑center upgrades. The company announced that it has allocated $11 billion to “AI initiatives” over the next three years, which includes the development of new generative‑AI tools for content moderation and ad targeting. Meta also spent $6.1 billion on data‑center expansion, bringing its total data‑center investment to $17.9 billion over the past 12 months.

Although the company framed these investments as “necessary to maintain long‑term competitive advantage,” analysts and the Seeking Alpha piece warn that such spending could be a drag on short‑term profitability. The article cites the CFO’s remarks that Meta plans to “tighten our operating margins” in Q4 by reducing discretionary spend on “non‑core” tech projects.

Guidance and outlook

For Q4, Meta is projecting revenue of $36.0 billion, up 5 percent YoY, and ad revenue of $34.0 billion, up 7 percent. Management reiterated that they expect “steady growth in advertising” as a result of higher demand for AI‑driven ad products and a continued focus on small‑business advertisers. Meta also stated that they intend to “continue investing in AI and emerging technologies while balancing costs to protect margins.”

Despite the optimism, the article cautions that Meta’s margin is still under pressure. In Q3, operating margin fell to 42 percent from 44 percent YoY, and net income margin dipped to 24 percent from 26 percent. The company’s CFO pointed to the “high cost of capital” and the “ongoing need to invest in AI” as reasons for the margin decline.

Investor reaction and broader context

Meta’s stock closed 1.3 percent higher on the day of the earnings announcement, reflecting a cautious optimism. The Seeking Alpha article notes that the broader social‑media space remains a “tug‑of‑war” between platforms that are aggressively investing in AI. For instance, TikTok’s growth has been accelerating, especially among younger users, and Meta is trying to counterbalance this with its own AI‑driven content discovery and ad‑placement algorithms.

The article also points out that the macro‑economic environment—rising interest rates, inflation, and supply‑chain disruptions—continues to weigh on consumer spending. As a result, advertisers are being more selective about where they allocate their budgets, and Meta’s ability to attract that spend depends heavily on its product innovation and data‑analytics capabilities.

Key takeaways

• Meta’s Q3 2023 earnings show a modest 5 percent revenue growth and a 6 percent increase in ad revenue, driven largely by AI‑enhanced ad tools and higher U.S./EU demand.
• User engagement remains strong, particularly for video content, but competition from TikTok and YouTube continues to be a risk.
• The company’s heavy investment in AI and data‑center expansion—amounting to $17.9 billion in the past year—has led to a slight erosion in operating and net‑income margins.
• For Q4, Meta projects continued ad growth but signals that it will tighten discretionary spend to protect margins.
• Investors remain cautious about the sustainability of Meta’s margin trajectory given the ongoing “overspending” on AI and infrastructure.

By pulling together the financial results, the company’s strategic focus on AI, and the current competitive landscape, the Seeking Alpha article provides a balanced view of Meta’s strengths and risks as it navigates a rapidly changing digital advertising ecosystem.