Social network operator Meta Platforms (NASDAQ: META) beat Wall Street’s revenue expectations in Q2 CY2026, with sales up 28% year on year to $60.8 billion. On the other hand, next quarter’s revenue guidance of $62.5 billion was less impressive, coming in 0.9% below analysts’ estimates. Its GAAP profit of $6.18 per share was 14.4% below analysts’ consensus estimates.
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Meta (META) Q2 CY2026 Highlights:
- Revenue: $60.8 billion vs analyst estimates of $60.23 billion (28% year-on-year growth, 1% beat)
- EPS (GAAP): $6.18 vs analyst expectations of $7.22 (14.4% miss)
- Revenue Guidance for Q3 CY2026 is $62.5 billion at the midpoint, below analyst estimates of $63.08 billion
- Operating Margin: 30.9%, down from 43% in the same quarter last year
- Free Cash Flow Margin: 1.3%, down from 22% in the previous quarter
- Daily Active People: 3.6 billion, up 120 million year on year
- Market Capitalization: $1.51 trillion
"AI is accelerating our core business today, powering our next generation of products, and opening the door to entirely new enterprise opportunities," said Mark Zuckerberg, Meta founder and CEO.
Company Overview
Famously founded by Mark Zuckerberg in his Harvard dorm, Meta Platforms (NASDAQ: META) operates a collection of the largest social networks in the world - Facebook, Instagram, WhatsApp, and Messenger, along with its metaverse focused Reality Labs.
Revenue Growth
Examining a company’s long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Over the last three years, Meta grew its sales at an excellent 23.7% compounded annual growth rate. Its growth surpassed the average consumer internet company and shows its offerings resonate with customers, a great starting point for our analysis.
This quarter, Meta reported robust year-on-year revenue growth of 28%, and its $60.8 billion of revenue topped Wall Street estimates by 1%. Company management is currently guiding for a 22% year-on-year increase in sales next quarter.
Looking further ahead, sell-side analysts expect revenue to grow 21% over the next 12 months, a slight deceleration versus the last three years. We still think its growth trajectory is attractive given its scale and implies the market is forecasting success for its products and services.
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Daily Active People
User Growth
As a social network, Meta generates revenue growth by increasing its user base and charging advertisers more for the ads each user is shown.
Meta struggled with new customer acquisition over the last two years as its daily active people were flat at 3.6 billion. This performance isn’t ideal because internet usage is secular, meaning there are typically unaddressed market opportunities. If Meta wants to accelerate growth, it likely needs to enhance the appeal of its current offerings or innovate with new products. 
Luckily, Meta added 120 million daily active people in Q2, leading to 3.4% year-on-year growth. The quarterly print was higher than its two-year result, suggesting its new initiatives are accelerating user growth.
Revenue Per User
Average revenue per user (ARPU) is a critical metric to track because it measures how much the company earns from the ads shown to its users. ARPU can also be a proxy for how valuable advertisers find Meta’s audience and its ad-targeting capabilities.
Meta’s ARPU growth has been exceptional over the last two years, averaging 24.4%. Although its daily active people were flat during this time, the company’s ability to successfully increase monetization demonstrates its platform’s value for existing users. 
This quarter, Meta’s ARPU clocked in at $16.89. It grew by 23.7% year on year, faster than its daily active people.
Key Takeaways from Meta’s Q2 Results
Revenue in the quarter beat by a bit, but EPS missed and revenue guidance for next quarter fell short. Overall, this quarter could have been better. The stock traded down 7.4% to $541.67 immediately following the results.
The latest quarter from Meta’s wasn’t that good. One earnings report doesn’t define a company’s quality, though, so let’s explore whether the stock is a buy at the current price. The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).
