Meta cash flow turned negative in the third quarter of 2026 as infrastructure spending outpaced cash generated by operations, despite revenue rising 26% to $64.60 billion. The company reported negative free cash flow of $2.12 billion for the quarter ended September 30, compared with positive $10.63 billion a year earlier.

Meta cash flow reflects the scale of infrastructure investment

Meta’s third-quarter results announcement, published October 21, showed operating cash flow of $32.79 billion against capital expenditures of $34.91 billion, including principal payments on finance leases. That spending exceeded the quarter’s operating cash generation as Meta expanded its artificial intelligence capacity.

The distinction is important: Meta continued to generate substantial cash from operations, but its investment spending was larger. The company calculates free cash flow by subtracting purchases of property and equipment and finance-lease principal payments from operating cash flow.

Advertising revenue rose 26% to $63.06 billion, accounting for nearly all quarterly sales. Meta also held $82.45 billion in cash, cash equivalents and marketable securities at September 30, providing a substantial liquidity reserve despite the quarterly free-cash-flow deficit.

Capital spending outlook rises at the lower end

Meta narrowed its full-year 2026 capital expenditure outlook to $135 billion–$145 billion from $130 billion–$145 billion. The change raised the minimum expected spending while leaving the upper end unchanged.

For the fourth quarter of 2026, management forecast revenue of $73 billion–$76 billion. Looking further ahead, Meta said it expected to continue investing aggressively in 2027, although its budget and capacity plans were still being developed.

Management said AI investments were already generating incremental advertising revenue, while investments in newer AI capabilities would take longer to produce returns than investments in the core business. Meta did not provide a full-year 2027 revenue outlook.

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