Meta Executives Discuss Q2 Earnings Expectations: AI Strategy to Drive Salary Growth in 2026

Meta released its unaudited quarterly earnings report for fiscal year 2025, reporting revenue of $475.16 billion, a 22% increase compared to the same period last year, excluding the impact of exchange rate fluctuations; net profit was $183.37 billion, a 36% increase.

Following the earnings release, Meta CEO Mark Zuckerberg, CFO Susan Li, and other executives held an analyst conference call to answer questions related to business operations.

Below is a transcript of the call:

Eric Sheridan from Goldman Sachs: My first question is for Mark. Looking back at the past three to six months, what have been your main takeaways and experiences with regards to AI strategy development? Or, conversely, how has our AI strategy influenced management's approach to talent recruitment, algorithm construction, etc.? Based on your recent experiences, what can you share with us about the future development of Meta's AI strategy?

My second question is for Susan. In last month's earnings conference call, you mentioned expanding talent recruitment and enhancing our company's algorithm capabilities. Can you elaborate further on how these two areas will impact our operating expenses and capital expenditures over the next 12 to 18 months?

Mark Zuckerberg: Overall, I think your questions are focused on "how long it takes for us to achieve truly strong AI or Super Intelligence." As of now, based on our observations, we find that previous assumptions have become more accurate and closer to reality. I believe this will continue to be the case.

In previous earnings calls, I've shared many interesting stories about the company's technological advancements. For example, I see our internal teams are exploring the use of Llama 4 large models to build autonomous AI agents, which will help improve Facebook algorithms and enhance user engagement. I believe this will be a significant attempt.

From my perspective, managing a company like Meta always presents an extremely interesting challenge - that is, we may face a situation where technology development in the next few years makes the world completely different. Therefore, one side of our efforts needs to constantly improve many aspects to adapt to changes; on the other hand, our company also adheres to the principle of prioritizing Super Intelligence, believing that it will eventually reshape all systems and underlying logic.

Ultimately, we will continue to observe and track the development trajectory of AI. I believe AI technology will continue to move in a faster direction, which will also impact our many decisions, such as ensuring we have an absolutely excellent team; ensuring we maintain industry-leading algorithm capabilities so that researchers can conduct more research and push results into products, benefiting tens of billions of users.

We will actively promote these efforts. Of course, when it comes to predicting future technological developments, it's like making a bet. We will follow up on our observations and try to understand and interpret them.

Susan Li: Currently, we have not started planning for 2026's budget yet, as next year's operating environment may be highly dynamic and changing rapidly. As of now, we have rough estimates for a few areas: one is our 2026 infrastructure budget, which will directly impact our company's expense expenditures in the coming year; two is considering the AI talents we recruited this year, we also expect salary growth in 2026. Therefore, these two areas are what we can currently share with you regarding 2026 capital expenditures and overall expenditure forecasts.

In terms of overall expenses, just like I mentioned earlier, we predict infrastructure spending will become the largest item on our 2026 expense list, including increased depreciation costs for existing assets, services, and infrastructure. Additionally, according to our forecast, in 2025 and 2026, the proportion of short-lived assets on our balance sheet will be higher than in previous years. Furthermore, another driver of cost growth comes from operating expenses, including energy costs related to asset maintenance, maintenance costs, and operational expenses. Looking ahead to 2026, our company's cloud service expenses will also increase to meet user demand for capacity and network-related cost increases. In summary, our spending in infrastructure will account for a significant proportion of our overall expenditures.

The second largest driver of 2026 overall expenses is employee salaries. This mainly stems from our investment in related field talent over the past few years, such as this year's AI talents who brought about full-year salary budget forecasts.