Family daily active people (DAP) grew 6% year-over-year to 3.48 billion in June 2025. Ad impressions delivered across Family of Apps increased 11% year-over-year, and the average price per ad increased 9% year-over-year in Q2 2025, demonstrating continued strength in the core advertising business.

Meta is making significant investments in AI initiatives, including generative AI and superintelligence, to enhance products and advertising tools, and in Reality Labs for metaverse and wearables. The company expects these AI initiatives to require increased investment in infrastructure and headcount, signaling a long-term strategic focus.

In June 2025, Meta completed an investment in Scale AI by acquiring a non-voting minority interest, with $13.79 billion included in non-marketable equity investments. This acquisition aligns with Meta's strategic focus on AI capabilities and expanding its technological foundation.

Total costs and expenses as a percentage of revenue decreased to 57% in Q2 2025 from 62% in Q2 2024, indicating effective cost management. This improvement was partially driven by lower legal-related costs, which contributed to a 27% year-over-year decrease in general and administrative expenses in Q2 2025.

Effective January 1, 2025, management extended the estimated useful lives of most servers and network assets to 5.5 years. This accounting change resulted in a $1.58 billion reduction in depreciation expense and a $1.34 billion increase in net income for the six months ended June 30, 2025, positively impacting reported profitability.

At the beginning of June 2025, Meta reclassified $2.04 billion of certain data center assets as held-for-sale, with plans to dispose of them through a contribution to a third party for co-developing data centers. This move reflects management's proactive approach to optimizing infrastructure and capital deployment.

Meta faces ongoing and new legal proceedings and government inquiries globally, including FTC administrative actions regarding 'subscription for no ads' and minors' data, EU Commission fines (€798M for Facebook Marketplace, €200M for 'no ads' model), and various privacy and antitrust lawsuits. These challenges could lead to substantial fines, changes in business practices, and resource diversion.

The development and deployment of AI, particularly generative AI and superintelligence, introduce risks such as harmful content, accuracy issues, bias, intellectual property infringement, and increased regulatory scrutiny. The company acknowledges that new legal frameworks for AI are rapidly evolving, creating uncertainty and potential for adverse impacts.

Meta's ad targeting and measurement tools rely heavily on data signals from user activity on websites and services not controlled by Meta, as well as signals from third-party mobile operating systems and browsers (e.g., Apple, Google). Changes by these third parties or new regulations limiting data signal use continue to adversely impact advertising revenue and effectiveness.

The Family of Apps (FoA) segment continues to be the primary revenue driver, accounting for 99% of total revenue in Q2 2025 ($47.15 billion out of $47.52 billion). This highlights Meta's sustained strong competitive position in its core social media and advertising businesses.

Meta acknowledges facing significant competition from other social networking companies, such as TikTok, which have reduced engagement among some users, particularly younger demographics. This ongoing competitive pressure necessitates continuous product evolution and innovation to retain and attract users.

While Reels is experiencing growth in usage, it monetizes at a lower rate than Meta's traditional Feed and Stories products. This indicates a potential competitive disadvantage in monetizing newer content formats, which could impact overall advertising revenue growth in the foreseeable future.

Total costs and expenses as a percentage of revenue decreased to 57% in Q2 2025 from 62% in Q2 2024, demonstrating improved operational efficiency. This was primarily due to lower legal-related costs and the accounting change related to asset useful lives.

Overall employee headcount increased 7% year-over-year to 75,945 as of June 30, 2025, with growth mainly in engineering and other technical functions supporting AI and Reality Labs. This strategic allocation of human capital aims to drive long-term innovation, while marketing and sales headcount saw a 2% decrease.

The company continues to make significant investments in data centers and network infrastructure, with purchases of property and equipment totaling $29.48 billion for the six months ended June 30, 2025. This ongoing investment is crucial for supporting core business and AI efforts, alongside efforts to optimize existing assets through reclassification.

Research and development expenses increased 23% year-over-year to $12.94 billion in Q2 2025 (from $10.54 billion in Q2 2024). This significant investment is directed towards AI initiatives, including generative AI and superintelligence, as well as virtual, augmented, and mixed reality technologies for the metaverse.

Meta is actively developing privacy-enhancing technologies to improve ad product performance by relying on anonymized or aggregated third-party data, and developing tools for marketers to share data into Meta's systems. This strategic shift aims to mitigate the impact of evolving privacy regulations on advertising effectiveness.

Investments in AI initiatives, particularly the AI-powered discovery engine, have shown positive results in improved user engagement and monetization across products. This indicates successful application of technology to enhance user experience and business outcomes.

Meta repurchased $9.76 billion of Class A common stock in Q2 2025, bringing the total for the six months ended June 30, 2025, to $23.16 billion. With $28.23 billion remaining authorized, this signals ongoing confidence in the company's valuation and commitment to returning capital to shareholders.

Beginning in Q1 2025, Meta increased its quarterly cash dividend by 5% to $0.525 per share. The company paid $2.66 billion in dividends for the six months ended June 30, 2025, demonstrating a consistent commitment to shareholder returns.

Capital expenditures, including principal payments on finance leases, totaled $17.01 billion in Q2 2025 and $29.48 billion for the six months ended June 30, 2025. The company anticipates full-year capital expenditures of approximately $66 billion to $72 billion in 2025, indicating significant investment in infrastructure to support core operations and AI efforts.

The company notes an increased focus from regulators, investors, and other stakeholders on disclosure, reporting, and diligence requirements regarding social and environmental risks and initiatives. This indicates growing external pressure and internal commitment to ESG transparency.

Meta faces multiple lawsuits and government investigations alleging 'social media addiction' and mental health harms for users under 18, along with scrutiny over content moderation practices. The EU Commission has opened formal proceedings under the Digital Services Act (DSA) to assess compliance regarding systemic risks to minors, highlighting significant social responsibility challenges.

As part of its normal course of business, Meta has entered into agreements ranging from three to 25 years to purchase clean and renewable energy. While specific volume commitments are not fixed, this demonstrates an ongoing environmental commitment to sustainable operations.

The company acknowledges that inflation, high interest rates, and general macroeconomic and geopolitical uncertainty continue to pressure advertising budgets. This indicates an ongoing challenging market environment that could adversely affect future advertising revenue.

Meta is subject to a complex and evolving array of U.S. and foreign laws and regulations, including GDPR, DMA, DSA, and U.S. state privacy laws, which require significant operational resources and modifications to business practices. Recent EU Commission fines of €798 million and €200 million underscore the material impact of these regulatory headwinds.

Geopolitical events, such as the war in Ukraine (restricting access in Russia), and international trade volatility, continue to adversely affect Meta's revenue and business in various regions. The company notes that government actions and trade disputes can lead to increased compliance risks and operational complexities.