Meta wows Wall Street despite spending billions on AI and facing social media addiction trial
As Meta spends billions on artificial intelligence datacenters and its CEO prepares to testify in a landmark social media trial, the company is earning a pretty penny.Meta reported strong financial results on Wednesday, beating Wall Street expectations of $58.59bn with $59.89bn in revenue for the fourth quarter of 2025.It reported earnings per share (EPS) of $8.
88 – which also surpassed Wall Street expectations of $8,23 in EPS,Meta’s stocks jumped nearly 10% in after-hours trading after the release,“We had strong business performance in 2025,” said founder and CEO Mark Zuckerberg,“I’m looking forward to advancing personal superintelligence for people around the world in 2026.
”The earnings report follows Meta’s major expansion of its multibillion-dollar investment into AI infrastructure in 2025.On Tuesday, the company announced a deal worth up to $6bn with Corning, a manufacturer of complex materials for telecoms and electronics, to supply fiber optic cables for the tech giant’s datacenters.Zuckerberg spoke on the earnings call about a “major AI acceleration” that will continue to grow in 2026.“We’re starting to see agents really work,” he said.“This will unlock the ability to build completely new products and transform how we work.
”The company is particularly focused on building superintelligence and AI that is even more tuned into a personal context.Zuckerberg described a broader effort to merge LLMs with the recommendation systems that already power Facebook, Instagram, Threads and Meta’s ads.“Today, our apps feel like algorithms that recommend content,” he said.“Soon, you’ll open our apps and you’ll have an AI that understands you and also happens to be able to show you great content or even generate great personalised content for you.”Meta expects to spend between $162bn and $169bn in 2026 – with most of that money going towards infrastructure costs, followed by employee compensation – especially new hires to support AI expansion.
Investors have previously expressed concerns over the high costs of Meta’s investments into AI as broader worries about an unstable AI financial bubble circulate on Wall Street.Zuckerberg has maintained, in response, that these investments should turn out to be profitable over the long term.Zuckerberg struck a similar tone on Wednesday’s call, when he was asked about how investments into AI will deliver revenue over the next few years.As it goes all-in on AI, Meta’s focus is moving away from virtual reality and the metaverse, previously a $10bn fixation of Zuckerberg’s; the tech giant began laying off more than 1,000 employees who focused on virtual reality this week, 10% of the Reality Labs division, according to multiple reports.Zuckerberg said he expects losses from Reality Labs to be similar to losses last year; the unit reported a loss of $6.
02bn on $955m in sales,He said on Wednesday that continued investment in Reality Labs would mostly be focused on glasses and wearables, noting that sales of Meta’s glasses more than tripled last year,As tech giants invest heavily in the physical infrastructure of AI, datacenters are increasingly facing political scrutiny over their strain on energy bills and the environment,Georgia is leading a legislative effort to ban building new datacenters until March – with the hope that government officials have time to better regulate them,Maryland and Oklahoma are considering similar legislation.
Democrats in Congress are investigating reports that big tech companies are passing on the soaring utility costs of datacenters to ordinary Americans.Even Donald Trump is worried about datacenters’ effects on an already expensive electricity market.Meta is focused on a PR push to convince Americans that datacenters aren’t so bad; the company spent $6.4m to run ads in November and December in state capitals and Washington, stating that datacenters can help bring jobs to communities, the New York Times reported on Wednesday.Meta states in its press release that its datacenters have already supported 30,000 skilled trade jobs during construction and 5,000 operational jobs, though it is unclear if those numbers are US-only or global.
But news reports suggest these facilities typically create few permanent jobs beyond the construction phase.Zuckerberg has also been ordered to testify in a landmark trial, which began this week.Meta and other tech companies are facing allegations that social media companies made their products intentionally addictive and harmful to young people.It’s the first time they will have to answer in open court – and while Zuckerberg has previously testified before Congress, fielding questions from seasoned prosecutors may involve harsher questioning.Zuckerberg did not speak about the trial on the earnings call.
British American Tobacco accused of helping North Korea fund terrorism in lawsuit
Hundreds of US military service members, civilians and their families have filed a lawsuit for unspecified damages against British American Tobacco (BAT), one of the world’s largest tobacco companies, and a subsidiary, claiming the company spent years illicitly helping North Korea fund terrorism weapons that were used against Americans.BAT formed a joint venture in 2001 with a North Korean company to manufacture cigarettes in the country. The venture quietly continued, a 2005 Guardian investigation revealed, even as the US government publicly warned North Korea was funding terrorism and imposed sanctions on the country. Amid mounting international pressure in 2007, the company claimed it was ending business in North Korea, but secretly continued its operation through a subsidiary, the US justice department said in 2023. BAT’s venture in North Korea provided around $418m in banking transactions, “generating revenue used to advance North Korea’s weapons program,” Matthew Olsen, then the justice department official in charge of its national security division, said during a 2023 Senate hearing
Donald Trump expected to nominate Kevin Warsh as US Federal Reserve chair
Donald Trump is expected to nominate the former Federal Reserve governor Kevin Warsh as its next chair amid an extraordinary attempt by the president to tighten his grip on the US central bank and flout its longstanding independence.Trump told reporters on Thursday that he planned to announce his choice for chair of the Federal Reserve on Friday morning, hinting that “a lot of people think that this is somebody that could have been there a few years ago”.That fuelled speculation that he had chosen Warsh, who was considered for the Fed chair in 2017. There was a surge of bets on Warsh to be nominated on the Polymarket predictions site, where his chances rose to 94% on Friday.The Financial Times reported on Friday that Trump was preparing to nominate Warsh, citing three people familiar with the matter
US regulators open inquiry into Waymo self-driving car that struck child in California
The US’s federal transportation regulator said Thursday it had opened an investigation after a Waymo self-driving vehicle struck a child near an elementary school in southern California last week, causing minor injuries.The National Highway Traffic Safety Administration said the child in Santa Monica ran across the street on 23 January from behind a double parked SUV towards the school and was struck by the Waymo autonomous vehicle during normal school drop-off hours. The agency said there were other children, a crossing guard, and several double-parked vehicles in the vicinity.The federal agency is opening a preliminary evaluation to investigate whether the Waymo AV exercised appropriate caution given its proximity to the elementary school during drop-off hours, and the presence of young pedestrians and other potential vulnerable road users. The agency said it plans to examine the vehicle’s “intended behavior in school zones and neighboring areas, especially during normal school pick up/drop off times, including but not limited to its adherence to posted speed limits” and will “also investigate Waymo’s post-impact response”
UK-based pair behind messaging app accused of giving data to Iranian regime
The creators of a messaging app accused of handing user data to the Iranian regime live on a windswept hill in a British coastal town, the Guardian can reveal.Hadi and Mahdi Anjidani are the cofounders of TS Information Technology, established in 2010 and now registered at the address of a tax accountancy in Shoreham-by-Sea in West Sussex. It is the UK branch of an Iranian software corporation, Towse’e Saman Information Technology (TSIT).The company makes popular computer games, a payment platform capable of helping Iranians skirt sanctions, and Gap Messenger, a sleek purple messaging app billed as an Iranian alternative to Telegram.But while Gap’s public profile says the app is encrypted and does not share its data with third parties, Iranian digital rights experts say their investigations contradict those claims
Lindsey Vonn airlifted from course after crash in final downhill before Olympics
Lindsey Vonn crashed in her final World Cup downhill before the Milano Cortina Winter Olympics on Friday, leaving the American skiing great limping and clutching her left knee as organizers abandoned the race amid worsening conditions.The 41-year-old lost control after landing a jump on the upper section of the course in Crans-Montana, Switzerland, skidding sideways into the safety netting as snow fell steadily and visibility deteriorated. Vonn’s airbag deployed on impact and she remained down for several moments while medical staff attended to her on the piste.Vonn eventually stood and was able to ski away, but did so gingerly. She repeatedly took weight off her left leg, using her poles to steady herself, and stopped several times on the run down to check her knee
Rybakina poses threat to Sabalenka’s bid for legendary status in Australian Open final
At the end of yet another semi-final in Melbourne on Thursday night, Aryna Sabalenka slammed the door shut on Elina Svitolina with a searing forehand winner, her 29th of the night. It was another near flawless performance from the Belarusian, another match she dominated from start to finish without any response, reinforcing her status as the leading hard court player of her generation.Six matches in, Sabalenka’s fourth consecutive run to the Australian Open final has proved one of her most impressive. Sabalenka is yet to drop a set and she has shown how much her game has evolved by also dominating the net and peppering opponents with an array of delicate drop shots. The few times she has been pushed, such as in her third round match against Anastasia Potapova, the world No 1 has produced her best tennis in the decisive moments and she has been in control of the baseline throughout
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