Meta Platforms Reports Significant Growth in Advertising Revenue
Meta Platforms has recorded an impressive 24% increase in advertising revenue year-over-year, reaching a staggering $58.1 billion in the fourth quarter, a period characterized by unprecedented holiday advertising demand.
The social media behemoth is adeptly refining its focus on artificial intelligence, positioning 2026 as a pivotal year for organizational metamorphosis, fueled by AI advancements—this includes the streamlining of various teams after years of considerable anticipation.
“We are witnessing a pronounced acceleration in AI,” asserted Meta CEO Mark Zuckerberg during prepared statements. “I foresee 2026 as a year where this momentum will amplify across multiple dimensions.”
In the quarter ending December 31, Meta’s overall ad impressions surged by 18% year-over-year, while the average ad price noted a 6% increment, reflecting heightened demand, as per an earnings statement.
By the Numbers
$58.1 billion
Advertising revenue generated by Meta in Q4 2025 reflects record holiday demand.
$10 billion
Combined revenue run rate achieved by Meta’s AI-generated video tools in Q4.
6%
Increase in average ad price on Meta in Q4, indicative of robust demand.
Expounding on his long-term AI vision, Zuckerberg illustrated possible applications, such as crafting individualized video games via Meta’s Horizon Worlds platform, which users can subsequently share within their social networks.
In the immediate term, the organization intends to amplify efforts where successes have already been realized, even as more intricate AI applications are meticulously developed.
“Our focus extends beyond advertising. I believe the figures indicate that for the forthcoming years, ads will remain the primary catalyst for growth in our enterprise,” Zuckerberg conveyed during an investor call discussing these results.
“All of these innovations, despite their potential for rapid scaling, will require time to achieve significance comparable to that of our advertising sector.”
On the operational front, Meta is harnessing AI to enhance its ad ranking and learning frameworks that scrutinize user behavior.
During Q4, the company doubled its deployment of graphics processing units aimed at training the Generative Ads Recommendation Model, implementing additional modifications that collectively yielded a 3% increase in clicks on Facebook and a 1% rise in conversions on Instagram, according to CFO Susan Li.
Advertisers are increasingly engaging with Meta’s generative AI tools for campaign formulation. The revenue run rate from the company’s video generation offerings reached $10 billion in Q4.
Notably, the growth rate for these features eclipsed overall increases in ad revenue by nearly a factor of three, as highlighted by Li.
Looking forward, Meta aims to integrate AI further into transactions by employing shopping agents that provide more personalized recommendations to users.
“Our advertising solutions today assist businesses in pinpointing the right, highly specific audiences interested in their offerings,” stated Zuckerberg. “Emerging shopping tools will enable users to discover a highly specific assortment of products from our catalog.”
While AI embodies a complex and resource-demanding venture, the company is exploring more efficient methodologies supported by AI-native tools.
Last year, Meta experienced the departure of pivotal AI figures, while recent media narratives have indicated that its newly established AI divisions have encountered operational friction with the broader organization.
“We are beginning to observe projects that once necessitated extensive teams now being executed by a single, exceptionally skilled individual,” remarked Zuckerberg.
As AI enhances the efficacy of Meta’s advertising efforts, these technologies are accompanied by substantial financial outlays: capital expenditures reached $22.14 billion in Q4 and $72.22 billion for the entirety of the year.
This trajectory of spending is projected to escalate considerably, with the company forecasting capital expenditures for 2026 to fall between $115 billion and $135 billion, with the majority earmarked for AI advancements.
Source link: Mobilemarketer.com.
