US Q3 Results: Meta Sales Rise 26 Percent as Texas Instruments Profit Jumps 78 Percent
Meta Platforms reported third-quarter revenue of 64.60 billion dollars on 21 October, 26 percent more than a year earlier. Its revenue was the largest of the 5 US companies in the table below, all of which reported after the New York close. Texas Instruments raised net income 78 percent to 2.43 billion dollars. IBM, Lam Research and Tesla also reported. The Edge’s previous US roundup covered SpaceX, Netflix and Capital One.
Five US companies, third-quarter results
| Company | Revenue ($bn) | Net income ($bn) | Net margin (%) |
|---|---|---|---|
| Meta Platforms | 64.60 | 9.86 | 15.26 |
| Tesla | 28.05 | 0.79 | 2.81 |
| IBM | 17.10 | 2.19 | 12.80 |
| Lam Research | 8.22 | 2.75 | 33.50 |
| Texas Instruments | 6.06 | 2.43 | 40.05 |
Ranked by revenue. Net margin is our calculation from each company’s reported revenue and net income. Lam Research’s quarter ended 27 September; the other 4 report their third quarter of 2026. IBM’s net income includes a 10 million dollar loss from discontinued operations; Tesla’s is net income attributable to common stockholders. Margins are calculated from the companies’ unrounded results, so they can differ slightly from figures rebuilt from the rounded entries.
Meta grows sales 26 percent and announces a new share class
Advertising brought in 63.06 billion dollars, or 97.62 percent of Meta’s revenue on our calculation. Ad impressions rose 10 percent. The average price per ad rose 14 percent. Daily active people averaged 3.64 billion in September, up 3 percent.
Net income reached 9.86 billion dollars, against 2.71 billion dollars a year earlier. Meta puts the rise at 264 percent. All of it comes from the tax line, on our reading. Pre-tax income fell 39.99 percent, on our calculation. The effective tax rate was 87 percent in the third quarter of 2025. This quarter it was 24 percent.
Operating income went the other way, down 37 percent to 12.99 billion dollars. The quarter carries a 9.89 billion dollar charge for an agreement with 52 attorneys general to resolve litigation over teen mental health and social media. Without the charge, Meta says operating income would have been 22.88 billion dollars. That is 11.42 percent above last year’s 20.54 billion dollars, on our calculation. It would also mean an operating margin of 35.42 percent, on our calculation.
Spending is the bigger story. Capital expenditure, including finance lease principal, reached 34.91 billion dollars in the quarter. That equals 54.03 percent of revenue on our calculation, up from 37.81 percent a year earlier. Free cash flow was negative 2.12 billion dollars, despite 32.79 billion dollars of operating cash flow.
Meta narrowed its 2026 capital expenditure range to 135 billion to 145 billion dollars, from 130 billion to 145 billion dollars. On our sum, it spent 85.82 billion dollars in the first 9 months, including finance lease principal. On our calculation, that leaves 49.18 billion to 59.18 billion dollars for the fourth quarter. Fourth-quarter revenue guidance is 73 billion to 76 billion dollars. The midpoint sits 15.32 percent above the third quarter, on our calculation.
Meta also announced a new class of publicly listed, non-voting Class C common stock. The certificate creating it takes effect on 19 January 2027. Holders will receive 1 Class C share for each Class A and Class B share, as a one-time stock dividend. The company expects the Class A price to reflect the effect of a two-for-one stock split. The change will not alter any shareholder’s voting power.
Meta: sales, spending and tax
| Measure | Q3 2026 | Q3 2025 |
|---|---|---|
| Revenue ($bn) | 64.60 | 51.24 |
| Capital expenditure ($bn) | 34.91 | 19.37 |
| Capex share of revenue (%) | 54.03 | 37.81 |
| Operating income ($bn) | 12.99 | 20.54 |
| Effective tax rate (%) | 24 | 87 |
| Net income ($bn) | 9.86 | 2.71 |
Capital expenditure includes principal payments on finance leases. The third-quarter 2025 figure is our sum of the two lines, and the share of revenue is our calculation. Third-quarter 2026 operating income is after the 9.89 billion dollar legal charge.
Texas Instruments and Lam Research lift profit
Texas Instruments reported revenue of 6.06 billion dollars, 28 percent more than a year earlier and 11 percent above the second quarter. Haviv Ilan, the chairman, president and chief executive, pointed to continued broad growth in industrial, automotive and data center markets. Operating profit rose 73 percent to 2.87 billion dollars. The operating margin widened to 47.46 percent from 35.07 percent, on our calculation.
Analog revenue rose 32 percent to 4.91 billion dollars. It supplied 90.02 percent of the year-on-year revenue gain, on our calculation. Analog now makes up 81.11 percent of revenue, on our calculation. Free cash flow over the 12 months to September reached 8.42 billion dollars, against 2.42 billion dollars a year earlier. For the fourth quarter, the company expects revenue of 5.80 billion to 6.30 billion dollars and earnings per share of 2.45 to 2.79 dollars. The 6.05 billion dollar midpoint is 0.08 percent below the third quarter, on our calculation.
Lam Research reported “record revenue, profit, and earnings per share” for its September quarter, in the words of Tim Archer, its president and chief executive. He linked the result to AI driving higher semiconductor demand and to the company’s operational execution. Revenue was 8.22 billion dollars, 22 percent above the June quarter. Against the 5.32 billion dollars of the September 2025 quarter, the rise is 54.38 percent on our calculation.
Net income reached 2.75 billion dollars, 75.51 percent above the year-earlier 1.57 billion dollars, on our calculation. Systems revenue rose 61.60 percent on the year to 5.73 billion dollars, on our calculation. China took 35 percent of revenue and Korea 20 percent. Lam guided December-quarter revenue to 8.60 billion dollars, plus or minus 400 million dollars.
IBM leans on software as Tesla raises research spending
IBM grew revenue 5 percent to 17.10 billion dollars, or 6 percent at constant currency. Software rose 8 percent to 7.80 billion dollars. Red Hat grew 11 percent. Software made up 45.63 percent of revenue but 64.94 percent of segment profit, on our calculation. Consulting was flat at 5.34 billion dollars. Infrastructure rose 4 percent. Within it, distributed infrastructure grew 31 percent and IBM Z fell 20 percent.
Income from continuing operations rose 26 percent to 2.20 billion dollars. On our reading, tax did most of that work. Pre-tax income rose 2.76 percent, on our calculation. The effective tax rate dropped to 11.9 percent from 28.2 percent. The 388 million dollar fall in the tax charge accounts for 85.27 percent of the 455 million dollar gain, on our calculation. IBM now expects full-year free cash flow to grow by more than 1 billion dollars. It kept its constant currency revenue growth range of 4 to 5 percent.
Tesla’s revenue was 28.05 billion dollars, against 28.10 billion dollars a year earlier, which the company called roughly flat. Net income attributable to common stockholders fell 42.68 percent to 0.79 billion dollars, on our calculation. A year earlier it was 1.37 billion dollars. Tesla tied the drop to higher operating expenses for research and development projects, stock-based pay including the 2025 CEO Performance Award, and selling, general and administrative costs. It also cited lower regulatory credit revenue and lower energy generation and storage gross profit. Energy generation and storage revenue fell to 2.88 billion dollars from 3.42 billion dollars, partly because of tariff-related customer refunds.
Operating expenses climbed 39.24 percent, on our calculation. Research and development spending rose faster still, by 69.39 percent on our calculation. Gross margin improved anyway, by 160 basis points to 19.59 percent on our calculation. Services and other revenue grew 32.52 percent, on our calculation. Deliveries came to 486,532 vehicles, 2 percent fewer. Production rose 4 percent to 464,391. Cash, cash equivalents and short-term investments stood at 45.45 billion dollars after free cash flow of 1.53 billion dollars. Tesla built its 10 millionth vehicle and began Robotaxi rides with Cybercabs in Austin on 3 September.
Why it matters: The profit headlines need care this quarter. Meta’s 264 percent jump rests on last year’s 87 percent tax rate; its pre-tax income fell. IBM’s 26 percent rise leans on a lower tax rate. Revenue is the cleaner read, and Lam grew it 54.38 percent on the year, on our calculation. Meta spent more than half its third-quarter sales on capital expenditure, on our calculation. Lam’s record quarter came as AI drove higher semiconductor demand.
Outlook: Meta’s fourth-quarter tax rate guidance is 15 to 17 percent, below this quarter’s 24 percent. Its capital expenditure range leaves up to 59.18 billion dollars for the fourth quarter, on our calculation. Lam expects December-quarter earnings per share of 2.33 dollars, plus or minus 15 cents. Texas Instruments sees fourth-quarter revenue of 5.80 billion to 6.30 billion dollars. The certificate creating Meta’s Class C stock takes effect on 19 January 2027.
Sources: Meta Platforms, Texas Instruments, Lam Research, IBM, Tesla, The Edge.
