Investing.com -- Meta Platforms beat Wall Street’s third-quarter revenue expectations on strong advertising growth and issued an upbeat forecast for the current quarter, while approving a new class of publicly listed nonvoting shares as it continues to invest heavily in artificial intelligence.

Shares rose 4% following the results.

The Facebook and Instagram parent reported revenue of $64.60 billion for the quarter ended Sept. 30, up 26% from a year earlier and above analyst estimates of $63.33 billion. Earnings per share came in at $3.83, beating the consensus estimate of $3.57.

Advertising remained the company’s primary growth driver, generating $63.06 billion in revenue, up 26% year over year and ahead of expectations for $61.85 billion.

Meta’s board approved the establishment of a new class of publicly listed, nonvoting Class C common stock, effective January 2027. The move introduces a new share class as the company faces mounting demands to finance its AI ambitions. The announcement did not specify whether the shares would be used to raise additional capital.

The company’s profitability was weighed down by a $9.89 billion legal charge tied to an August settlement with 52 state attorneys general over teen mental health litigation. Operating income came in at $12.99 billion, below analyst expectations of $20.85 billion.

Chief Executive Mark Zuckerberg said Meta had reached major milestones in its push toward personal superintelligence, including the launch of Muse and Muse Wonder, which he described as the company’s first frontier models.

“Our investments are paying off, the core business is strong, and we’re seeing velocity across the board,” Zuckerberg said.

Meta forecast fourth-quarter revenue of $73 billion to $76 billion, putting the midpoint at $74.5 billion, above analyst expectations of $73.57 billion. The outlook points to continued momentum heading into the holiday advertising season.

The company raised its full-year 2026 expense forecast to $175 billion to $179 billion, from $165 billion to $169 billion previously, incorporating the legal charge. Meta also narrowed its capital expenditure forecast to $135 billion to $145 billion, compared with its previous range of $130 billion to $145 billion.

Despite the higher costs, Meta expects full-year operating income to exceed 2025 levels, excluding the third-quarter legal charge, suggesting the company expects its underlying business to remain resilient as it pours money into AI infrastructure.

The Family of Apps segment, which includes Facebook and Instagram, generated $64.16 billion in revenue, exceeding estimates of $62.75 billion. Operating income was $17.12 billion, below the $23.3 billion consensus.

Reality Labs, Meta’s virtual and augmented reality division, reported revenue of $443 million, missing estimates of $517.7 million. Its operating loss of $4.13 billion was narrower than the expected $5.13 billion loss.

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