According to Forbes, internal Meta documents reveal the company projected 10% of its overall revenue—estimated at a staggering $16 billion—would come from advertisements for scams and banned goods. The Securities and Exchange Commission is reportedly investigating Meta for running ads for financial scams, while UK regulators found Meta’s products were involved in 54% of all payment-related scam losses in 2023. Meta’s stock has been declining recently after third-quarter earnings showed EPS of $1.05, falling 84% below economists’ projections, though the company attributed this to a one-time $15.9 billion tax charge. Meanwhile, Mark Zuckerberg has dropped to the world’s sixth-richest person as Meta shares slide, even as the company raises its capital expenditure guidance to between $70 billion and $72 billion to prepare for “superintelligence.”
The Reality Check
Here’s the thing about that $16 billion figure—Meta’s pushing back hard. Their spokesperson Andy Stone says those documents present a “selective view” and that internal estimates were actually lower. But he declined to provide updated numbers to Reuters. That’s always telling, isn’t it?
When your own documents show you’re making bank from scam ads while regulators are circling, that’s not a great look. Especially when UK authorities found Meta was involved in more than half of all payment scam losses. More than all other social platforms combined. That’s not just bad—that’s systemic.
Market Meltdown
So what’s really happening with Meta’s stock? The recent decline followed their Q3 earnings, where they missed projections by a whopping 84%. Now, they’re blaming a one-time tax charge from Trump’s “One Big Beautiful Bill Act”—which sounds like something from a parody, but apparently it’s real.
Without that charge, they say EPS would have been $7.25. But markets don’t really care about hypotheticals. They care about actual performance and future prospects. And right now, investors are seeing regulatory risk, scam ad projections, and massive spending increases all at once.
The Spending Spree
Meta’s capital expenditure guidance just jumped from $66-72 billion to $70-72 billion. Zuckerberg says they’re “aggressively” preparing for superintelligence. Basically, they’re betting the farm on AI while their core business faces some pretty serious questions.
It’s interesting timing—pumping billions into future tech while current revenue streams are under scrutiny for being, well, problematic. The company that’s facing ongoing investigations into data practices now has this scam ad revelation to contend with. Not exactly the smooth sailing you’d expect from a tech giant.
The Bigger Picture
Look, tech companies have faced regulatory issues before. But projecting billions from scam ads while being investigated for… running scam ads? That’s next-level awkward. And it’s hitting Zuckerberg where it hurts—his net worth and ranking among the world’s richest.
The real question is whether this is a temporary blip or something more fundamental. Meta’s betting everything on AI and the metaverse while their advertising business—which still pays for everything—shows these kinds of cracks. It’s a high-stakes game, and right now, the house isn’t looking too secure.
