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Meta shares slide 8% after Q2 earnings miss and weaker guidance
Even with a Q2 sales beat, Meta reported an EPS miss tied to legal expenses and more than $1 billion in severance, and its guidance midpoint came in below expectations.
Meta Platforms stock fell about 8% after its Q2 report disappointed investors, drawing negative reactions from Wall Street analysts and leading to price target reductions, according to MarketBeat Ratings.
The company still beat Q2 sales estimates, with revenue up 28% year-over-year, but its earnings performance was pressured by a sharp EPS miss. MarketBeat Ratings attributed the miss largely to legal issues that emerged earlier in 2026, which drove multi-billion-dollar expenses, and it also said Meta booked over $1 billion in severance tied to recent layoffs.
MarketBeat Ratings added that Meta indicated substantial legal expenses could continue, including risk tied to its youth-related legal matters. The outlet also said the midpoint of Meta’s revenue guidance came in below expectations, a concern given the company’s heavy AI spending, and that it beat sales estimates by the smallest margin among hyperscalers in the quarter.
Despite the selloff, MarketBeat Ratings reported that most analysts have not abandoned the company, with the MarketBeat consensus price target near $790, implying upside of more than 30%. The outlet said more recently updated targets after the report look less aggressive, with other averages closer to the mid-$700s.