SpaceX reported $7.6B in AI revenue and $19.6B in capital expenditures. Meta’s advertising business grew, but it also raised the low end of its AI spending plan.
Demand is showing up in revenue. The cost of serving that demand is showing up too.
Meta’s Ad Growth Meets a Higher Spending Plan
Meta brought in $63.1B in advertising revenue in Q3 2026, up 26% from a year earlier. Ad impressions rose 10%, while the average price per ad rose 14%. GAAP net income reached $9.86B, up 264%.
That is a strong business behind a much larger spending plan. Meta now expects FY26 capital spending of $135B to $145B. The low end was previously $130B.
Meta guided for Q4 revenue of $73B to $76B, compared with an expected $73.73B. The Financial Times reported that Meta plans non-voting shares it could sell to fund AI spending without diluting Mark Zuckerberg’s control. Meta also announced a 2-for-1 stock split effective in January 2027. Holders will receive one new non-voting Class C share for each existing share.
SpaceX shows another side of the same spending question. Its Q3 2026 revenue was $14.6B, up 161% from a year earlier, and net income was $4.4B. It reported $13.1B in operating cash flow alongside $19.6B in capital expenditures.
SpaceX says new AI compute deployments pay back in less than a year, with pricing above $50 per watt. That is its case for spending at this pace. In the reported trading snapshot, $CRWV, $NBIS, $HUT, $WULF and $CIFR rose.
AI Demand Is Growing, but the Risks Differ
Super Micro’s preliminary Q1 revenue of $18.5B to $19.5B came in above the $15B estimate. Its gross margin of 12% to 12.5% also topped the 10.5% estimate. $SMCI rose about 9.6% in the market recap, while $DELL and $HPE gained too.
Reuters reported that Samsung Electronics and SK Hynix are upgrading factories in China to make more advanced memory chips. They aim to meet AI demand and fend off a fast-growing Chinese rival. The KOSPI surged 4.7%; Samsung rose 7%, and SK Hynix rose 7.5%.
The expected earnings growth is less broad. One estimate puts Micron and Nvidia at 36% of expected S&P 500 Q3 2026 earnings growth. Excluding the top 10 contributors turns that estimate into an 11% year-over-year decline.
Anthropic’s reported loss needs a different kind of care. A draft IPO prospectus reviewed by Reuters puts its first-half net loss at $80.7 billion. The prospectus attributes much of the widening loss to a rise in the fair value of bonds convertible into Anthropic shares.
Yardeni Research’s AI Bubble Meter reads 83/100 for Bubble Conditions and 34/100 for Crash Triggers. Yardeni’s view is that valuations look stretched, while the conditions needed for a crash have not fully appeared.
Meta also has a product question: what can Muse earn? One commentator questioned whether paying users and shopping commissions could justify its costs. Muse had more than 5 million downloads in its first 22 days, but the commentator said actual use was unknown. The commentator also cited cases where Muse arranged a Marketplace pickup without the seller’s approval and accepted $600 for a phone with a $700 minimum price.
Meta says it cannot access data stored in users’ Muse virtual machines and does not use Muse conversations to target Facebook or Instagram ads.
Netflix’s EPS Beat Did Not Settle the Guidance Concern
Netflix reported $12.87B in revenue, matching the estimate. EPS was $0.87, above the $0.82 expected. But free cash flow of $2.88B missed the $3.22B estimate.
Its Q4 revenue guidance of $13.44B was below the $13.51B expected. Q4 EPS guidance was $0.67 against $0.73, and full-year revenue guidance was $51.1B against $51.23B. $NFLX fell more than 6% in one trading update. The EPS beat did not settle the concern about what comes next.
Oil, Rates and Housing Add Pressure
Brent was described as near or above ~$110 as Middle East tensions flared. In a separate market recap, WTI settled 0.7% lower at $97.15. Philip Morris International cited higher energy costs in its reduced profit forecast.
The New York Times reportedly said the U.S. and Israel had developed plans for renewed Iran attacks after the November 3 elections, with energy infrastructure among possible targets. These were reported plans, not attacks that had happened.
Markets put roughly 84% to 87% odds on the Fed holding rates at its October 27 to 28 meeting. A strong majority also expected a hike by December, and the 10-year Treasury yield was near 5.1%. President Donald Trump called for lower rates. Fed chair Kevin Warsh had said hikes could soon be on the table.
U.S. pending home sales fell 7.3% in September to a record low in the series dating to 2001. Japan’s September exports rose 16.7% from a year earlier, helped by chip demand. High oil prices lifted imports, though, and Japan’s trade deficit widened more than expected.
Meta’s ad business is strong, and its spending floor just rose. How much of that business will Meta put toward AI?