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Back of Napkin

Meta Platforms, Inc. META

Three-pass checkedFresh as companies report

Meta raised its capital spending guidance three times in eight months, from $115B to $145B, and the shares fell from $790.80 to $559.02.

Revenue grew 28% last quarter and operating income fell, because the company paid $1.18B of severance to cut 8,000 people while building data centres.

META · price with moving averages

Daily · 6MWeekly · 3Y
$201$358$515$672$829 Sep '23Apr '24Nov '24Jun '25Jan '26Aug '26 BID
EMAs82140

Source: market data.

The business

Meta sells advertising on Facebook, Instagram, WhatsApp and Messenger. That is essentially the whole company: $60.4B of the $60.8B quarterly revenue and all of the profit. Advertisers pay to reach roughly half the planet, and the machine learning that decides which advert to show is why the price per impression keeps rising.

Reality Labs builds headsets and glasses. It produced $431M of revenue last quarter and lost $4.62B.

Inside the complete Back of Napkin

  1. 01The business
  2. 02The numbers
  3. 03Management
  4. 04How it fails or surprises you
  5. 05The shape of the payoff
  6. 06Closing thoughts
  7. 07Methodology

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