Mark Zuckerberg’s Meta Platforms said Wednesday that third-quarter revenue rose 26% to $64.6 billion, above the $63.3 billion analysts expected, according to Visible Alpha consensus from S&P Global Market Intelligence. Meta reported net income of $9.9 billion, or $3.83 a share, versus $2.7 billion, or $1.05 a share in the year-ago period. Operating income, profit from its core business, fell to $13 billion $20.5 billion a year ago, against the $16.9 billion analysts expected. Operating margin also got squeezed, moving to 20% from 31% last quarter and 40% a year ago. Hours before the results, news broke that a New Mexico judge ordered the company to pay $25 billion in penalties related to the Cambridge Analytica data privacy scandal. A jury previously found more than 43 million violations, which meant Meta’s penalty could have been nearly $220 billion. Meta plans to appeal. The results also come a week after Meta’s Superintelligence Labs launched Muse Wonder to the public, its first frontier model. Meanwhile, Q3 included a charge from a separate $10 billion settlement Meta struck with a group of attorneys general over youth safety. The terms of the settlement will see Meta pay about $18 billion to the states over the next decade, depending on cooperation from TikTok and Google’s YouTube. Without the charge, operating income would have been $22.9 billion and earnings of $7.40 a share, rather than $13 billion and $3.83.Capital expenditures, which have tech investors on tenterhooks, clocked in at $34.9 billion, compared to $31 billion in the second quarter and $19.4 billion a year ago. Meta slightly tweaked its full year capex guidance to $135 billion to $145 billion, from $130 billion to $145 billion. Melissa Otto, global head of Visible Alpha research at S&P Global, wrote in a note before the results that consensus capex for 2026 had risen more than $14 billion since April to about $140 billion—almost double 2025. She noted that investors continue to want clarity on how that spending will translate into shareholder returns. Overall in tech infrastructure spending, capex is expected to continue ballooning in 2026 to $790 billion, according to Otto, almost double what it was in 2025 at $404 billion. And it won’t stop there. For 2027, capex is expected to rise to $1.2 trillion, meaning companies will have spent nearly $2 trillion on the AI buildout in two years. Free cash flow, which has been a sore spot for Meta, was negative $2.1 billion, compared to $784 million in the second quarter and $10.6 billion a year ago. This story was originally featured on Fortune.com