More than 10 million people in the United States and Canada have set up Meta’s Muse personal agent in the six weeks since it launched, Mark Zuckerberg told investors on Wednesday — the standout product number in a third quarter where revenue rose 26 percent to $64.6 billion, and where the cost of building AI pushed free cash flow below zero.
The figure confirmed estimates published earlier in the week by market intelligence firm Sensor Tower, but Zuckerberg spent less time on the count than on how people are using the agent, according to TechCrunch. About 25 percent of people who set up Muse use it on any given day — more than twice the level Threads managed at its launch, he said — and Muse has been No. 1 in the App Store almost every day.
Shopping is the surprise hit
The most common use case is shopping. More than a quarter of the people using Muse are buying through it, with an average purchase size of over $200, Zuckerberg said. “Plaid told us that they had not seen activity like they are seeing with their connector on any other service before,” he said, referring to the financial technology company whose connector Muse uses for agentic shopping. “And in the first week, we had to work with Stripe to raise credit limits since the volumes were above what any of us expected.”
After shopping, the most popular uses are personal productivity tasks such as connecting Muse to email and calendars. Zuckerberg argued that willingness signals trust in Muse’s security design, pointing to its Secure VM and a forthcoming Confidential VM that he said will prevent even Meta from seeing users’ content.
How Meta plans to get paid
Zuckerberg said Muse has reached product-market fit and that Meta’s focus now shifts to scaling it, growing revenue and cutting compute costs. The model he described keeps Muse free for most people, with businesses paying fees on transactions the agent helps facilitate, while people who want the most advanced models or extra usage — and businesses that want Muse for work — subscribe directly. He said the Family of Apps revenue from existing Muse users is already several hundreds of dollars a year per person, and that he expects Muse to eventually earn more per user than that.
The obstacle is cost. Muse is, in Zuckerberg’s words, very compute intensive to run today. Meta is building capacity to serve more than a billion people over the next few years and expects to improve Muse’s cost efficiency by more than ten times within a year, which he said would let the business become profitable once its revenue lines are at scale.
The ad business is paying for all of it
The engine funding the build-out had a strong quarter. Advertising revenue rose 26 percent to $63.1 billion, with ad impressions up 10 percent and the average price per ad up 14 percent. An average of 3.64 billion people used at least one Meta app each day in September, up 3 percent, and nearly 10 million advertisers used at least one of its generative AI creative tools. Net income was $9.86 billion, up sharply from $2.71 billion a year earlier, when a one-time tax charge weighed on results.
The costs, though, are growing faster than sales. Total costs and expenses jumped 68 percent to $51.6 billion, including a $9.89 billion charge tied to Meta’s agreement with 52 state attorneys general over teen mental health litigation. That charge cut reported operating income by 37 percent to about $13 billion; excluding it, operating income would have risen 11 percent and adjusted earnings were $7.40 a share, against $3.83 on a reported basis. Capital spending reached $34.91 billion in the quarter, and free cash flow was negative $2.1 billion. Reality Labs revenue fell 6 percent to $443 million on lower Quest headset sales, partly offset by growing AI glasses revenue.
A bigger bill, and a new share class
Meta narrowed its full-year capital spending guidance to $135 billion to $145 billion — raising the low end from $130 billion — and lifted its expense outlook to $175 billion to $179 billion to reflect the legal charge. It guided fourth-quarter revenue to between $73 billion and $76 billion. The board also approved a new class of non-voting Class C stock, effectively a 2-for-1 stock split delivered as a stock dividend, expected to begin trading in late January 2027.
Shares rose in after-hours trading after the results. The open questions are the familiar ones, now with numbers attached: finance chief Susan Li warned that youth-related trials are scheduled in the United States in the coming months, and the Muse bet will be judged on whether its shopping and subscription revenue can catch up with a capital bill that is still rising.
