Meta will report second-quarter 2026 results after the market closes on Wednesday, July 29, with analyst consensus expecting $60.18 billion in revenue. The company has guided for $58-61 billion, a wide range reflecting uncertainty about advertising demand.

The key story is AI. Meta’s recommendation systems are delivering measurable returns on ad spend, with conversion rates up roughly 6% from AI-driven improvements. That’s rare for a mature platform that’s already milked most traditional optimization gains. Simultaneous volume and price gains mean advertisers are both spending more and getting better results.

Threads Momentum and Platform Consolidation

Threads surpassed X (formerly Twitter) in daily mobile active users this year, hitting 141.5 million compared to X’s 125 million. The platform’s growth matters less for today’s earnings than for the long-term ad opportunity. Meta is consolidating social media advertising, and Threads gives it another surface for AI-driven recommendations. If the company can bring Threads into profitability, it unlocks a second major ad business.

Capital Expenditure and Investor Concerns

Meta expects to spend between $125 billion and $145 billion on capital expenditures during 2026, with most directed at AI chips, data centers, and power infrastructure. That massive spending is why investors are nervous heading into the call. The question isn’t whether AI is working—it is. The question is whether the revenue runway justifies spending that could strain margins if growth stalls.

Management will likely emphasize monetization. The fact that AI is already improving ad performance should help calm fears that capex spending won’t pay off.

Watch the full-year capex guidance closely. Any reduction signals confidence that the infrastructure investments are paying off faster than expected.