Financial Data and Key Metrics Changes - In Q4 2025, total revenue was $59.9 billion, up 24% year-over-year, or 23% on a constant currency basis [15][33] - Operating income was $24.7 billion, representing a 41% operating margin [16] - Net income reached $22.8 billion, or $8.88 per share [16] - Total expenses were $35.1 billion, up 40% year-over-year, driven by employee compensation, legal expenses, and infrastructure costs [15][33] - Free cash flow was $14.1 billion, with cash and marketable securities totaling $81.6 billion [16] Business Line Data and Key Metrics Changes - Family of apps revenue was $58.9 billion in Q4, up 25% year-over-year, with ad revenue at $58.1 billion, up 24% [13] - Reality Labs revenue was $955 million, down 12% year-over-year due to the previous year's product introduction [14] - Average price per ad increased by 6% year-over-year, benefiting from improved ad performance [13] Market Data and Key Metrics Changes - Over 3.5 billion people used at least one of the company's apps daily, with over 2 billion daily active users on Facebook and WhatsApp [3] - Engagement metrics showed significant growth, with Instagram Reels watch time up more than 30% year-over-year in the U.S. [17] Company Strategy and Development Direction - The company is focusing on AI-driven performance gains and plans to release new AI models and products throughout 2026 [3][4] - Investments are being directed towards glasses and wearables, with Reality Labs expected to gradually reduce losses [9] - The company aims to enhance user experiences through personalized AI and improved recommendation systems [5][6] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the acceleration of AI and its potential to transform business operations and product offerings [10][11] - The company anticipates strong revenue growth in Q1 2026, with a guidance range of $53.5 billion to $56.5 billion [33] - Legal and regulatory challenges in the U.S. and E.U. are being monitored, which could impact financial results [35] Other Important Information - The company is investing significantly in infrastructure to support AI initiatives and improve operational efficiency [31][32] - The capital expenditures for 2026 are expected to be between $115 billion and $135 billion, driven by investments in AI and core business [34] Q&A Session Summary Question: Long-term revenue opportunities from AI investments - Management indicated that while the focus remains on improving core products, there are new business opportunities expected from AI advancements, including subscriptions and advertising [38][41] Question: Drivers of revenue growth in 2026 - Management highlighted strong demand and improvements in ad performance as key drivers for accelerated revenue growth in 2026 [39][44] Question: Internal compute capacity and its impact on ads business - Management acknowledged ongoing capacity constraints but expects to increase compute resources significantly in 2026, which should enhance ad performance [47][48] Question: Progress on Meta Superintelligence Labs (MSL) - Management noted that MSL is in its early stages, with positive early indicators, but emphasized that it is a long-term effort [62][63] Question: Expanding opportunities beyond ads - Management confirmed that while ads will remain the primary growth driver, there is a focus on exploring additional revenue streams beyond advertising [68][70] Question: Acceleration in e-commerce activity - Management reported healthy year-over-year growth across all verticals, with online commerce being the largest contributor to growth [72][73]