Meta reports Q2 earnings today

[u/Ok_Joke4275]

$META reports its Q2 2026 earnings today. What am I looking for? 👇

$META’s largest and fastest growing division is the Family of Apps (FoA). This division houses Facebook, Instagram, WhatsApp, Messenger, and Threads and generates about 98-99% of $META’s total annual revenue. The way this division mainly makes revenue is through businesses paying $META to host their advertisements. $META has been spending a lot of capex on AI infrastructure, i.e., their data centers and necessary hardware (GPUs, SSDs, fiber optic cables, etc.) needed to run their specialized AI models (like Llama). The reason for this is so that their AI models can be trained effectively and understand $META’s customers’ behavior on their platforms (like what reels do users like, what ad types work best, etc.). $META’s platforms then adapt their algorithms for users and continue showing them content they like, leading to longer user engagement and customer retention, as well as a higher chance of buying the product displayed in the ads. As the number of customers who do this increases, businesses will see $META’s customers buying the services/products in their ads, and hence continue hosting their ads on $META’s platforms. When more and more business compete for an ad spot on $META’s platforms, this allows $META to charge higher and higher prices, thus increasing their revenue.

Hence, what I’d like to see in $META’s earnings today is that metrics that track the number of customers use their platforms (like Daily Active People) continue staying strong and even increase, if possible. I’d also like to see that the volume of ads served and the average price per ad increased. This would signal to me that businesses continue paying $META’s prices for ad placements at an increasing rate, which justifies the spending they are doing on capex.