Since 2017, Boston Consulting Group and Fortune have partnered to identify firms with long-term growth potential, screening more than 3,000 companies every year for their capacity to generate growth from within.

The Future 120

This ranking evaluates how Fortune 500 companies are deploying AI, and how technology leaders value those investments relative to industry peers.

Fortune AIQ 75

The companies on the Global 500 employ 70.2 million people, and their revenue represents more than one-third of the world’s GDP.

Fortune Global 500

With a combined revenue of $21 trillion and $2.1 trillion in profits, the 2026 Fortune 500 is the definitive list of America's largest companies.

Fortune 500

AI is a major force shaping this year’s list—but it’s far from the only story.

World's Most Admired Companies

Fortune AIQ 50

The corporations on our annual list of the world's 500 largest companies combined to generate $41.7 trillion in revenue over the past year.

Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

Meta Platforms leaped eight spots to No.&nbsp;22 as its revenue rose 22% year over year, powered by advertising on Facebook and Instagram. Profits topped $62&nbsp;billion, even as Meta spent prodigiously on AI development.

The 300 companies on this year’s list brought in over $12.6 trillion in revenue for the latest 12 months, with the median revenue figure at $22 billion.

America's Most Innovative Companies

Leaders in all industries rely more than ever on Big Tech—and appreciate the giants that deliver, at scale, without drama.

These 50 companies exemplify the innovation, progress, and potential of AI.

AI Innovators 2025-Meta

Fortune 50 AI Innovators

The corporations on our annual list posted aggregate revenues of $41 trillion for the second year in a row.

Industries included in the sector are computers, internet services, IT services, semiconductors, and software companies.

Fortune Sector Leaders: Technology

The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

The 26th edition of the list shows how much esteem Big Tech giants command among other business leaders.

The 25th Fortune World’s Most Admired Companies list suggests that tech giants’ peers respect them as much as ever.

The corporations on our annual list of the world’s largest companies delivered a record $41 trillion in aggregate revenues.

GLOBAL-500-2023-Meta-Platforms

The 300 companies on this list are transforming industries from the inside out.

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

F500 2023-Meta

The social media giant and metaverse pioneer formerly named Facebook posted a 1% decline in revenues in 2022, the first such decline in its history as a public company; it still brought in nearly $117 billion. 
<ul> 
 	<li>With a round of layoffs announced in late 2022 and another in spring 2023, Meta cut about 21,000 jobs, or roughly a quarter of its workforce. CEO Mark Zuckerberg described 2023 as a “year of efficiency” in which a leaner Meta can execute its highest priorities more quickly.</li> 
 	<li>Meta pivoted some of its attention and resources from the metaverse to generative A.I. In February 2023, the company announced an A.I. language model called LLaMA that it would use in its chatbots to compete with Google and Microsoft.</li> 
 	<li>In May 2023, the U.S. Federal Trade Commission accused Meta’s core Facebook platform of violating an earlier agreement in which the company had pledged to protect the data of users of its Messenger Kids app. The FTC proposed modifying the agreement to forbid Meta from monetizing minors’ data in any way. The company strongly objected to the proposal, calling it a “political stunt.”</li> 
 	<li>Later in May, the European Union ordered Meta to stop sending Europeans’ personal data to the U.S., and imposed a $1.3 billion fine on the company for its past data transfers, which it said violated European privacy laws.</li> 
</ul>

Aggregate sales hit $37.8 trillion last year—an increase of 19%, the highest annual growth rate in the list’s history.

This year’s Fortune 500 marks the 68th running of the list.

F500 2022 Meta

The company formerly known as Facebook climbed seven spots on this year’s Fortune 500; its revenue grew 37.2% in 2021, to $118 billion, and it generated nearly $40 billion in profit. But the name change to Meta Platforms, announced by CEO Mark Zuckerberg in October 2021, is a sign of some of the challenges the company now faces. Meta Platforms’ core social media product, Facebook itself, saw its number of daily active users decline for the first time over the last three months of 2021. Meta also acknowledged that recent changes in privacy settings on Apple’s iOS apps were hurting Facebook’s ad-sales revenue. That changing landscape adds momentum to Meta’s new commitment to the metaverse, the digital and virtual world that Citi predicts will be worth $13 trillion in 2030. In December, Meta disclosed that it had already spent $10 billion on metaverse-related projects. The company admits those will take a long time to pay off, however, and Wall Street is concerned: The company’s share price fell almost 40% over the first four months of 2022.

Total revenue for the world’s biggest companies fell 4.8% to $31.7 trillion this year—the first decline in half a decade.

G500-2021-086-Facebook

Facebook, it appears, can’t be hurt—not by major ad buyers boycotting its service, not by state and federal investigations, and not even by a pandemic. Despite the impact of COVID-19 on its ad sales, Facebook impressed Wall Street all year by beating expectations. The company ended 2020 with almost $86 billion in revenues, up 22% year over year, and with $29 billion in profits, up nearly 58%. But Facebook faced major backlash for lax handling of hate on its service, including from former President Donald Trump, whom the service eventually barred after the U.S. Capitol riot. And this year, Facebook risks a big financial hit owing to Apple’s new privacy controls that let users limit tracking of their data.

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-34-Facebook

Collectively, the ranked companies produced a three-year average shareholder return of 33%, vs. 19% for the S&P 500.

FGC-2021-Facebook

100 Fastest-Growing Companies

For an astounding 13th straight year, Apple claims the top spot in Fortune’s annual ranking of corporate reputation, based on a survey of almost 3,800 executives, directors, and analysts.

This year's Fortune Global 500 generated $33.3 trillion in revenues and $2.1 trillion in profits.

G500-2020-144-Facebook

Facebook was the focus of increased government scrutiny in 2019. Regulators at the state, federal, and international level reviewed the ways the company has handled user data and permitted the dissemination of misinformation—investigations that sometimes led to hefty fines or other penalties. Despite the mounting heat, Facebook continued to rake in revenue in 2019. The company, led by CEO Mark Zuckerberg, had $70.7 billion in sales, up nearly 27% from the previous year. But 2020 will be a particularly challenging one for Facebook as it tries to proactively remove misinformation about the coronavirus pandemic while policing bad actors on its platform during the upcoming U.S. presidential election.

Explore this year's ranking of the 50 companies with the best long-term growth potential.

Future-50-2020-Facebook

Last but not least, the social media player’s underlying business remains strong. And new business opportunities continue to emerge: A global e-commerce strategy (including WhatsApp Pay) shows signs of promise, for example. Analysts project 17% to 20% future, long-term growth. At the same time, reputational risk is high—as is the very real threat of regulatory crackdowns across different regions, including the United States. Perhaps even more ominous, the Facebook core product is seeing declining engagement levels with younger demographics. In short: There is a reason the social network is on this list, but also a reason it comes in at No. 50.

The Future 50

This year's Fortune 500 marks the 66th running of the list.

F500-2020-046-Facebook

Facebook was the focus of increased government scrutiny in 2019. Regulators at the state, federal, and international level reviewed the ways the company has handled user data and permitted the dissemination of misinformation—investigations that sometimes led to hefty fines or other penalties. But despite the mounting heat, Facebook continued to rake in revenue in 2019. The company, led by CEO Mark Zuckerberg, had $70.7 billion in sales, up nearly 27% from the previous year, which helped it rise nearly a dozen ranks in the Fortune 500. But 2020 will be particularly challenging one for Facebook as it tries to proactively remove misinformation about the coronavirus pandemic while policing bad actors on its platform during the upcoming U.S. presidential election.

Collectively, the ranked companies produced a three-year average shareholder return of 19%, vs. 11% for the S&P 500.

Fastest Growing Companies 2020-52-Facebook

Here are the World's Most Admired Companies for 2019 as ranked in their industries. See who made the list.

This year's Fortune Global 500 generated $27.7 trillion in revenues and $1.5 trillion in profits.

Fortune's proprietary methodology allows us to zero in on the 50 global firms that are best poised to deliver—and continue delivering—above average gains.

This year's Fortune 500 marks the 65th running of the list.

Everybody loves an up-and-comer: 2019's top three-year performers in revenues, profits, and stock returns.

Here are the World's Most Admired Companies for 2018 as ranked in their industries. See who made the list.

Welcome to the inaugural Fortune Future 50, our new ranking of companies best positioned for breakout growth.

This year's Fortune 500 marks the 64th running of the list.

Everybody loves an up-and-comer: 2018's top three-year performers in revenues, profits, and stock returns.

Here are the World's Most Admired Companies for 2017 as ranked in their industries. See who made the list.

This year's Fortune 500 marks the 63rd running of the list.

Everybody loves an up-and-comer: 2017's top three-year performers in revenues, profits, and stock returns.

Here are the World's Most Admired Companies for 2016 as ranked in their industries. See who made the list.

This year's Fortune 500 marks the 62nd running of the list.

Too fast to be stopped: 2016's top three-year performers in revenue, profits, and stock returns.

Business insiders have spoken: Asked which companies they most admire, more than 4,100 executives, directors, and analysts chose these top 50 All-Stars.

This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Nike, Cisco, MasterCard, SABMiller, Vodafone, Google—and 45 other companies that are doing well by doing good.

Change the World

This year's Fastest-Growing Companies marks the 19th running of the list. In our annual list of public companies with the most stellar three-year profit, revenue, and stock growth, Facebook makes its first appearance.

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

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Future 120

Founded in 2004 as Facebook, Meta operates the world’s largest social media platforms and has heavily influenced the development of the internet over the past two decades through its pioneering use of personal data collection and targeted advertising. Meta’s products include Facebook, image-sharing app Instagram, and messaging platforms Messenger and WhatsApp; together, they enable users to keep in touch, share images and videos, and buy and sell goods. Meta’s Reality Labs segment develops virtual-reality-related consumer hardware and software, while Meta AI develops artificial intelligence tools including language-processing models. Facebook renamed itself Meta in 2021.

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Q4 2024

Meta Platforms (META): Company Profile, Stock Price, News, Rankings

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Meta Platforms

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Good afternoon. My name is Christa, and I will be your conference operator today. At this time, I would like to welcome everyone to the Meta Fourth Quarter and Full Year 2024 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session.

And this call will be recorded. Thank you very much. Kenneth Dorrell, Meta's Director of Investor Relations, you may begin.

Thank you. Good afternoon and welcome to Meta Platform's 4th quarter and full year 2024 earnings conference call. Joining me today to discuss our results are Mark Zuckerberg, CEO and Susan Li, CFO. Before we get started, I would like to take this opportunity to remind you that our remarks today will include forward looking statements. Actual results may differ materially from those contemplated by these forward looking statements.

Factors that could cause these results to differ materially are set forth in today's earnings press release and in our quarterly report on Form 10 Q filed with the SEC. Any forward looking statements that we make on this call are based on assumptions as of today, and we undertake no obligation to update these statements as a result of new information or future events. During this call, we will present both GAAP and certain non GAAP financial measures. A reconciliation of GAAP to non GAAP measures is included in today's earnings press release. The earnings press release and an accompanying investor presentation are available on our website at investor.

Atmeta.com. And now, I'd like to turn the call over to Mark.

All right. Thanks, Ken. Thanks, everyone, for joining today. We ended 2024 on a strong note with now more than 3,300,000,000 people using at least one of our apps each day. This is going to be a really big year.

I know it always feels like every year is a big year, but more than usual, it feels like the trajectory for most of our long term initiatives is going to be a lot clearer by the end of this year. So I keep telling our teams that this is going to be intense because we have about 48 weeks to get on the trajectory that we want to be on. In AI, I expect that this is going to be the year when a highly intelligent and personalized AI assistant reaches more than 1,000,000,000 people, And I expect Meta AI to be that leading AI assistant. Meta AI is already used by more people than any other assistant. And once a service reaches that kind of scale, it usually develops a durable long term advantage.

We have a really exciting roadmap for this year with a unique vision, focused on personalization. You know, we believe that people don't all want to use the same AI. People want their AI to be personalized to their context, their interests, their personality, their culture, and how they think about the world. I don't think that there's just going to be one big AI that everyone uses that does the same thing. People are going to get to choose how their AI works and what it looks like for them.

I continue to think that this is going to be one of the most transformative products that we've made and, we have some fun surprises that I think people are going to like this year. I think this will very well be the year when Llama and open source become the most advanced and widely used AI models as well. LAMA 4 is making great progress in training. LAMA 4 Mini is done with pre training, and our reasoning models and larger model are looking good too. Our goal with LAMA 3 was to make open source competitive with closed models and our goal for LAMA 4 is to lead.

LAMA 4 will be natively multimodal. It's an omni model and it will have AgenTek capabilities. So it's going to be novel and it's going to unlock, a lot of new use cases. And I'm looking forward to sharing more of our plan for the year on that over the next couple of months. I also expect that 2025 will be the year when it becomes possible to build an AI engineering agent that has coding and problem solving abilities of you know, around a good mid level engineer.

And this is going to be a profound milestone and potentially, you know, one of the most important innovations in history, like as well as, over time potentially a very large market. Whichever company builds this first, I think it's going to have a meaningful advantage in deploying it to advance their AI research and shape the field. So that's another reason why I think that this year is going to set the course for the future. Our Ray Ban Meta AI Glasses are a real hit and this will be the year when we understand the trajectory for AI glasses as a category. Many breakout products in the history of consumer electronics have sold 5000000 to 10000000 units in their 3rd generation.

This will be a defining year that determines if we're on a path towards many 100 of millions and eventually billions of AI glasses and glasses being the next computing platform like we've been talking about

for some time or if this is just going to be

a longer grind. But it's great overall to see people recognizing that these glasses are the perfect form factor for AI as well as just great stylish glasses. These are all big investments, especially the 100 of 1,000,000,000 of dollars that we will invest in AI infrastructure over the long term. I announced last week that we expect to bring online almost a gigawatt of capacity this year, and we're building a 2 gigawatt and potentially bigger AI data center that is, so big that it'll cover a significant part of Manhattan if it were placed there. We're planning to fund all of this by, at the same time, investing aggressively in initiatives that use these AI advances to increase revenue growth.

And we've put together a plan that will hopefully accelerate the pace of these initiatives over the next few years. That's what a lot of our new headcount growth is going towards. And how well we execute on this will also determine our financial trajectory over the next few years. There are a number of other important product trends related to our family of apps that I think we're going to know more about this year as well. We're going to learn what's going to happen with TikTok.

And regardless of that, I expect reels on Instagram and Facebook to continue growing. I expect threads to continue on its trajectory to become the leading discussion platform and eventually reach 1,000,000,000 people over the next several years. Threads now has more than 320,000,000 monthly actives and has been adding more than 1,000,000 sign ups per day. I expect WhatsApp to continue gaining share and making progress towards becoming the leading messaging platform in the U. S.

Like it is in a lot of the rest of the world. WhatsApp now has more than 100,000,000 monthly actives in the U. S. Facebook is used by more than 3,000,000,000 monthly actives and we're focused on growing its cultural influence. And I'm excited this year to get back to some OG Facebook.

All right. So, this is also going to be a pivotal year for the metaverse. The number of people using Quest and Horizon has been steadily growing. And this is a year when a number of the long term investments that we've been working on that will make the metaverse more visually stunning and inspiring will really start to land. So, I think we're going to know a lot more about Horizon's trajectory by the end of this year.

This is also going to be a big year for redefining our relationship with governments. We now have a U. S. Administration that is proud of our leading companies, prioritizes American technology winning and that will defend our values and interests abroad. And I am optimistic about the progress and innovation that this can unlock.

So this is going to be a big year. I think that this is the most exciting and dynamic that I have ever seen our industry between AI glasses, massive infrastructure projects, you know, doing a bunch of work to try to accelerate our business and building the future of social media. We have a lot to do. And, I think we're going to build some awesome things that shape the future of human connection. As always, I am grateful for everyone who's on this journey with us.

Thanks, Mark, and good afternoon, everyone. Let's begin with our consolidated results. All comparisons are on a year over year basis unless otherwise noted. Q4 total revenue was $48,400,000,000 up 21% on both a reported and constant currency basis. Q4 total expenses were $25,000,000,000 up 5% compared to last year.

Before I cover the specific cost lines, I would note that our 4th quarter expense growth rate reflects a 13 percentage point favorable impact from legal accrual reductions in Q4 and lower year over year restructuring costs. In terms of the specific line items, cost of revenue increased 15%, driven mostly by higher infrastructure

R and D increased 16%, primarily driven by higher employee compensation and infrastructure costs, which were partially offset by lower restructuring costs. Marketing and sales were approximately flat year over year. G and A decreased 67%, driven mostly by lower legal related expenses due to a 1 point $55,000,000,000 reduction in legal accruals related to certain legal proceedings. We ended the year with over 74,000 employees, up 10% year over year, with growth primarily driven by hiring and priority areas of monetization, infrastructure, generative AI, reality labs, as well as regulation and compliance. 4th quarter operating income was $23,400,000,000 representing a 48% operating margin.

Our tax rate for the quarter was 12%. Net income was $20,800,000,000 or $8.02 per share. Capital expenditures, including principal payments on finance leases, were $14,800,000,000 driven by investments in were $14,800,000,000 driven by investments in servers, data centers, and network infrastructure. Free cash flow was $13,200,000,000 We paid $1,300,000,000 in dividends to shareholders, ending the year with $77,800,000,000 in cash and marketable securities and $28,800,000,000 in debt. Moving now to our segment results.

I'll begin with our family of apps segment. Our community across the family of apps continues to grow and we estimate more than 3,300,000,000 people used at least one of our family of apps on a daily basis in December. Q4 total family of apps revenue was $47,300,000,000 up 21% year over year and q4 family of apps ad revenue was $46,800,000,000 up 21% on both a reported and constant currency basis. Within ad revenue, the online commerce vertical was the largest contributor to year over year growth. On a user geography basis, ad revenue growth was strongest in rest of world at 27%, followed by Asia Pacific and Europe at 23% and 22%, respectively.

North America grew 18%. In q4, the total number of ad impressions served across our services increased 6% and the average price per ad increased 14%. Impression growth was mainly driven by Asia Pacific. Pricing growth benefited from increased advertiser demand, in part driven by improved ad performance. This was partially offset by impression growth, particularly from lower monetizing regions and surfaces.

Family of Apps' other revenue was $519,000,000 up 55 percent, driven primarily by business messaging revenue growth from our WhatsApp business platform. We continue to direct the majority of our investments toward the development and operation of our family of apps. In Q4, family of apps expenses were $19,000,000,000 representing 76% of our overall expenses. Family of Apps expenses were up 5%, primarily due to growth in infrastructure costs and employee compensation, which were partially offset by lower legal related expenses. Family of Apps operating income was $28,300,000,000 representing a 60% operating margin.

Within our Reality Labs segment, Q4 revenue was $1,100,000,000 driven by hardware sales and up 1% year over year. Reality Labs expenses were $6,000,000,000 up 6% year over year, driven primarily by higher infrastructure costs and employee compensation, partially offset by lower restructuring costs. Reality Lab's operating loss was $5,000,000,000 Turning now to the business outlook. There are 2 primary factors that drive our revenue performance: our ability to deliver engaging experiences for our community and our effectiveness at monetizing that engagement over time. On the first, daily actives continue to grow across Facebook, Instagram, and WhatsApp year over year, both globally and in the United States.

In Q4, global video time grew at double digit percentages year over year on Instagram, and we're seeing particular strength in the US on Facebook, where video time spent was also up double digit rates year over year. We see continued opportunities to drive video growth in 2025 through ongoing optimizations to our ranking systems. We're also making several product bets that are focused on setting up our platforms for longer term success. Creators are one of our central focuses. On Instagram, we continue to prioritize original posts and recommendations to help smaller creators get discovered.

We also want to ensure creators have a place to experiment with their content, so we introduced a new feature in Q4 that allows creators to first share a Reel with people who don't follow them. This allows them to test content and see what performs best before deciding to share it with their followers, and also helps introduce them to entirely new audiences. Creative tools is another area we're investing in. In the coming weeks, we'll launch a new standalone app called Edits that provides a full suite of creative tools to make it easier for creators to make great reels on their phone. Another focus is making it easier for people to connect over content.

Reels are already reshared over 4,500,000,000 times a day and we've been introducing more features that bring together the social and entertainment aspects of Instagram. In the US, we recently launched a new destination in Reels that consists of content your friends have left a note on or liked. We're seeing very positive early results, and we'll look to expand this globally in the coming months. On threads, we made tremendous progress in 2024 and our focus this year is establishing threads as the place people come to keep up with what they care about. We're making a number of updates to our recommendation systems to prioritize more recent posts, surface content from top creators, and ensure people see more of the content from accounts they follow.

We will also continue improving custom feeds so people can build personalized feeds on topics they're interested in. Finally, Meta AI usage continues to scale with more than 700,000,000 monthly actives. We're now introducing updates that will enable Meta AI to deliver more personalized and relevant responses by remembering certain details from people's prior queries and considering what they engage with on Facebook and Instagram to develop better intuition for their interests and preferences. Now to the 2nd driver of our revenue performance, increasing monetization efficiency. The first part of this work is optimizing the level of ads with an organic engagement.

We continue to grow supply on lower monetizing surfaces like video, while optimizing ad supply on each of our surfaces to deliver ads at the time and place they will be most relevant to people. For example, we are continuing to better personalize when ads show up, including the optimal locations in the depth of someone's feed to introduce ad supply when it's most optimal for the user and revenue. This is enabling efficient supply growth. Longer term, we also see impression growth opportunities on unmonetized surfaces like threads, which we are beginning to test ads on this quarter. We expect the introduction of ads on threads will be gradual and don't anticipate it being a meaningful driver of overall impression or revenue growth in 2025.

The second part of increasing monetization efficiency is improving marketing performance. The ongoing enhancements to our ads ranking systems are an important driver of this work. In the second half of twenty twenty four, we introduced an innovative new machine learning system in partnership with NVIDIA called Andromeda. This more efficient system enabled a 10000 times increase in the complexity of models we use for ads retrieval, which is the part of the ranking process where we narrow down a pool of tens of millions of ads to the few thousand we consider showing someone. The increase in model complexity is enabling us to run far more sophisticated prediction models to better personalize which ads we show someone.

This has driven an 8% increase in the quality of ads that people see on objectives we've tested. Andromeda's ability to efficiently process larger volumes of ads also positions us well for the future as advertisers use our generative AI tools to create and test more ads. Another way we're delivering value for advertisers is through increased automation of their ad campaigns with Advantage Plus. Adoption of Advantage Plus shopping campaigns continues to scale, with revenue surpassing a $20,000,000,000 annual run rate and growing 70% year over year in Q4. Given the strong performance and interest we're seeing in Advantage Plus Shopping and our other end to end solutions, We're testing a new streamlined campaign creation flow so advertisers no longer need to choose between running a manual or Advantage Plus sales or app campaign.

In this new setup, all campaigns optimizing for sales, app, or lead objectives will have Advantage Plus turned on from the beginning. This will allow more advertisers to take advantage of the performance Advantage Plus offers while still having the ability to further customize aspects of their campaigns when they need to. We plan to expand to more advertisers in the coming months before fully rolling it out later in the year. Advantage plus Creative is another area where we're seeing momentum. More than 4,000,000 advertisers are now using at least one of our generative AI ad creative tools, up from 1,000,000 6 months ago.

There has been significant early adoption of our first video generation tool that we rolled out in October, Image Animation, with 100 of 1000 of advertisers already using it monthly. Next, I would like to discuss our approach to capital allocation. Our primary focus remains investing capital back into the business, with infrastructure and talent being our top priorities. On the first, we expect compute will be central to many of the opportunities we're pursuing as we advance the capabilities of Llama, drive increased usage of generative AI products and features across our platform, and fuel core ads and organic engagement initiatives. We're working to meet the growing capacity needs for these services by both scaling our infrastructure footprint and increasing the efficiency of our workloads.

Another way we're pursuing efficiencies is by extending the useful lives of our servers and associated networking equipment. Our expectation going forward is that we'll be able to use both our non AI and AI servers for a longer period of time before replacing them, which we estimate will be approximately 5 and a half years. This will deliver savings in annual capex and resulting depreciation expense, which is already included in our guidance. Finally, we're pursuing cost efficiencies by deploying our custom MTIA silicon in areas where we can achieve a lower cost of compute by optimizing the chip to our unique workloads. In 2024, we started deploying MTIA to our ranking and recommendation inference workloads for ads and organic content.

We expect to further ramp adoption of MTIA for these use cases throughout 2025 before extending our custom silicon efforts to training workloads for ranking and recommendations next year. From a hiring standpoint, our focus continues to be on adding technical talent to support our strategic priorities. In the Q4, nearly 90% of our year over year headcount growth was within the R and D function. The remaining growth was primarily in cost of revenue as we added infrastructure headcount to support our data center operations. In 2025, we expect headcount growth will continue to be primarily driven by technical roles across our priority initiatives within infrastructure, monetization, Reality Labs, generative AI, as well as regulation and compliance.

We anticipate headcount growth in our business functions will remain relatively limited. To achieve our ambitions in these areas, we will need to continue executing at a rapid pace. We're supporting this by building tools to help our engineering base be more productive. As part of our efficiency focus over the past 2 years, we've made significant improvements in our internal processes and developer tools and introduced new tools like our AI powered coding assistant, which is helping our engineers write code more quickly. Looking forward, we expect that the continuous advancements in llama's coding capabilities will provide even greater leverage to our engineers and we are focused on expanding its capabilities to not only assist our engineers in writing and reviewing our code, but to also begin generating code changes to automate tool updates and improve the quality of our code base.

Finally, we expect our strong financial position will enable us to support these investments while continuing to return capital to shareholders through share repurchases and dividends. Moving to our financial outlook, we expect Q1 total revenue to be in the range of $39,500,000,000 to $41,800,000,000 This reflects 8% to 15% year over year growth or 11% to 18% growth on a constant currency basis as our guidance assumes foreign currency is an approximately 3% headwind to year over year total revenue growth based on current exchange rates. This also reflects the effect of lapping LEAP Day in the Q1 of 2024. While we are not providing a full year 2025 revenue outlook, we expect the investments we're making in our core business this year will give us an opportunity to continue delivering strong revenue growth throughout 2025. Turning now to the expense outlook.

We expect full year 2025 total expenses to be in the range of $114,000,000,000 to $119,000,000,000 We expect the single largest driver of expense growth in 2025 to be infrastructure costs driven by higher operating expenses and depreciation. We expect employee compensation to be the 2nd largest factor as we add technical talent in the priority areas that I referenced earlier. Turning now to the capex outlook. We expect our full year 2025 capital expenses will be in the range of $60,000,000,000 to $65,000,000,000 We expect capex growth in 2025 will be driven by increased investment to support both our generative AI efforts and our core business. The majority of our capex in 2025 will continue to be directed towards our core business.

On to tax, absent any changes to our tax landscape, we expect our full year 2025 tax rate to be in the range of 12% to 15%. In addition, we continue to monitor an active regulatory landscape, including legal and regulatory headwinds in the EU and the U. S. That could significantly impact our business and our financial results. In closing, this was a good year for our company with investments across our priority areas delivering strong business performance and innovative new products for our community.

We have a compelling set of opportunities to invest in this year, which we expect will help us drive continued strong growth and develop transformative technologies that shape the future of our company and of the industry. With that, Christa, let's open up the call for questions.

Thank you. We will now open the lines for a question and answer session. And our first question comes from the line of Brian Nowak with Morgan Stanley. Please go ahead.

Thanks for taking my questions. Mark, you sound we appreciate all the excitement about this year and all the innovation to come. I know there's a lot of announcements throughout the course of the year, but wonder if you could just share a few sort of high level examples of your vision on new potential use cases and offerings that could drive utility for your users and value for your advertisers as you sort of think about LAMA4 and Meta AI changing throughout 2025? And then the second one on custom silicon, maybe a question for either of you. Just any learnings on the difference between your custom silicon and 3rd party chips in your ranking models and results?

And how should we think about the main gating factors as to how quickly you'll be able to move a higher percentage of your engagement to your custom silicon? Thanks.

On the first one, I tried to lay this out in my opening comments a bit. I mean, we're very focused on Meta AI as a highly intelligent and personalized assistant that you can access across our apps. There's a website, you can access it outside of our apps too. I think that the quality of this is just it's going to keep on improving and improved a lot over the last year. We're also finding more ways that it's useful integrate it into our services to help more people discover it.

I think that that's undoubtedly why, you know, so many hundreds of millions of people are using it today is because it's kind of easy to discover what we're doing and then keep using it. I don't know. You know, I I I want to I want to keep some surprises and and and fun, for for the stuff that we're going to release this year. I gave a bit of detail on what we're planning to do with Loma 4, that that I'm sure technical people will enjoy because we hadn't talked about that before. But I'm I'm gonna refrain from adding a whole lot more on what we're launching this year.

But it's it's the different things that I talked about. It's it's meta AI. I do expect LAMA 4 to be a very exciting set of releases. It's not just one thing. Just like with LAMA 3, there were kind of a few different models at different dates.

I think we'll see that with LAMA 4 too. And then the AI engineer piece, I'm really excited about. I mean, I don't know that that's going to be an external product anytime soon, but I think for what we're working on, you know, our goal is to advance AI research and advance our own development internally. And I think it's just going to be a very profound thing. So, I mean, that's something that I think will show up through making our products better over time.

But and then as that works, there will potentially be a market opportunity down the road. But I mean, for now and this year, we're really I think this is I don't think you're going to see this year, like an AI engineer that is extremely widely deployed, changing all of development, I think this is going to be the year where that really starts to become possible and lays the groundwork for a much more dramatic change in 'twenty six and beyond. I don't know. Yeah, that's kind of it.

Brian, I'm happy to take your second question about, custom silicon. So, first of all, we expect that we are continuing to purchase third party silicon from leading providers in the industry, and we are certainly committed to those long standing partnerships, But, you know, we're also very invested in developing our own custom silicon for unique workloads where off the shelf silicon isn't necessarily, optimal. And specifically, because we're able to optimize the full stack to achieve greater compute efficiency and, you know, performance per cost and power because our workloads might require a different mix of, you know, memory versus network, bandwidth versus compute, and so we can optimize that really to the specific needs of our different types of workloads. Right now, the in house MTIA program is focused on supporting our core ranking and recommendation inference workloads. We started adopting MTIA in the first half of twenty twenty four for core ranking and recommendations inference.

We'll continue ramping adoption for those workloads over the course of 2025 as we use it for both incremental capacity and to replace some GPU based servers when they reach the end of their useful lives. Next year, we're hoping to expand MTIA to support some of our core AI training workloads and over time, some of our Gen AI use cases.

Your next question comes from the line of Eric Sheridan with Goldman Sachs. Please go ahead.

Thank you so much for taking the question. Maybe I can go back to your comments on open source. Can you help us understand how your views continue to evolve with respect to the competitive dynamic around your approach with open source versus others in the industry and how your approach to open source could possibly bend the cost curve and improve return on capital for AI over the medium to long term? Thanks so much.

Yeah. I mean, on open source, I think the best analogy for us is what we did with open compute, where we weren't first to building the system. So then by the time that we got around to building it, it wasn't really a big advantage to have it be proprietary. So, we shared it. And then a lot of the industry adopted what we were doing, contributed innovations back to it.

By standardizing it on it, that meant that a bunch of supply chains standardized on building it, which made prices you know, more efficient for everyone. You know, I think what we see here is, you know, as Lama becomes more used, you know, it's more likely, for example, that silicon providers and others, other APIs and developer platforms will optimize their work more for that, and basically drive down the costs of using it and drive improvements that we can, in some cases use too. So, I think that the strategy will continue to be effective. And, yeah, I mean, I continue to be optimistic about this. I think it's working.

I also just think in light of some of the recent news, the new competitor, DeepSeq from China, I think it also just puts, it's one of the things that we're talking about is there's going to be an open source standard globally. And I think for our, kind of our national advantage, it's important that it's an American standard. So, we take that seriously and we want to build the AI system that people around the world are using. And, I think that if anything, some of the recent news has only strengthened our conviction that this is the right thing for us to be focused on.

Your next question comes from the line of Mark Shmulik with Bernstein. Please go ahead.

Yes. Thank you for taking my questions. Mark, appreciate we may get an answer this year. But looking out, as you've kind of tracked the progress of smart glasses, Orion and so forth, Do you view that as a better form factor to get the most out of the meta AI assistance you highlighted in your opening remarks? Or is it more complementary to kind of the in app experience in the way you've seen people use it today?

Meta Platforms (META) Q4 2024 Earnings Call Transcript

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