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Forecast: Meta ad revenues to hit $240bn in 2026

May 14, 2026

In recent years, Meta has transformed its proposition to advertisers through AI-driven automation, leading its advertising business to grow a forecasted 22.3 per cent to $240 billion (€204.9bn) this year, according to WARC Media.

Serving ads across its mass reach ‘family of apps’ remains the foundation of its monetisation strategy. Its fast-growing ad business funds an aggressive AI innovation programme – which, in turn, fuels the flywheel through further increases in ad revenue.

WARC Media’s latest Platform Insights report explores Meta’s hyper-efficient advertising business, evaluates usage across its apps, and assesses the performance of campaigns on Meta.

Alex Brownsell, Head of Content, WARC Media, and co-author of the report, commented: “Meta’s flywheel is spinning faster than ever. The company’s AI-driven automation is transforming how brands connect with audiences, driving rapid growth in advertising spend with Facebook and Instagram. This is enabling further record-breaking levels of investment in AI innovation. Yet investors appear concerned that the flywheel is at risk of spinning out of control, in light of plateauing user growth and mounting pressure to better monetise existing audiences. In this report, we explore the latest evidence-based insights to better understand Meta’s ad model and consider what might come next.”

Investment: WARC forecasts Meta’s advertising business to grow 22.3% in 2026 

In 2025, Meta’s ad business grew 22 per cent to $196 billion. As aforementioned, it is expected to grow a further 22.3 per cent to reach $240 billion in 2026, according to WARC Media forecasts, with a more modest growth of 12.1 per cent anticipated for 2027.

Prior to 2023, Meta’s annual ad revenue growth had lagged the total global social media market, and its share of total social spend was in decline. Following sizeable AI investments post-pandemic, it is now focused on optimising monetisation efficiency rather than simply increasing overall ad load. By deploying unified AI and automated campaign tools, it aims to enhance advertiser conversions and increase ad revenue without degrading user experience.

Facebook is forecast to account for 60 per cent of Meta’s ad revenue in 2026, compared with 40 per cent for Instagram. A unified AI architecture is helping to maintain double-digital growth across both platforms.

In its latest earnings call, Meta announced a $125 billion – $145 billion increase in annual capital expenditure on AI, funded almost exclusively through its ad business. This relative lack of revenue diversification compared with Alphabet and Amazon is proving a concern for investors, resulting in a 10 per cent drop in the company’s stock.

The US is Meta’s largest market for ad investment (42.2 per cent share on Facebook and 40.5 per cent on Instagram) followed by the UK (4 per cent on each platform) and Australia (1.7 per cent and 2.1 per cent respectively), according to WARC Media and Omdia data. However, more than half (55 per cent) of global marketers plan to boost investment in Instagram this year, versus only 25 per cent for Facebook, according to WARC’s annual Voice of the Marketer survey.

Consumption: Over 3.5bn people worldwide use Meta apps daily

Meta reports that over 3.5 billion people worldwide use at least one of its apps every day, although restrictions in Russia and Iran caused its first ever decline in total daily active users in Q1 this year.

Facebook’s scale means the age profile of its audience tallies with the total internet population, while Instagram skews younger. Millennials and GenX make up more than 70 per cent of wealthy global Facebook and Instagram users, per analysis by Ipsos.

Latin America, followed by Sub-Saharan Africa, leads in high-net-worth individual (HNWI) engagement on Facebook and Instagram—yet generates far less revenue per user than North America and Europe. Meta is now unlocking this monetisation opportunity through strategic expansions, including rolling out Threads ads in Brazil, seen as a key market.

Short-form video is becoming the content default across Meta. Its vertical video format Reels accounts for 45 per cent of all engagement on Instagram, and 29 per cent on Facebook – with time spent watching video content on Facebook globally up 8 per cent quarter-on-quarter.

Meta heavily invests in LLMs to develop a “deeper intuition about user interests” to help with ad targeting.

Performance: AI is helping Meta campaigns to become more efficient

Meta’s advanced AI capabilities are transforming campaign performance across its platforms. The company’s Q4 2025 model rollout drove a 24 per cent increase in incremental conversions through improved attribution, while analysis by Fospha found that its cost-per-purchase (CPP) has improved by 4.5 per cent year-on-year. Brands using Advantage+ have seen a 41 per cent higher blended ROAS and 17 per cent lower new customer acquisition cost versus those running manual campaigns.

Partnership Ads are emerging as a game-changer, with 71 per cent of consumers making purchases within days of seeing creator content across Meta’s apps.

Kantar analysis found that an average campaign allocates 4 per cent of budget to Instagram and 5 per cent to Facebook – but that both platforms deliver relatively higher shares of brand awareness, association and motivation to buy.

Instagram ranks as global marketers’ second most preferred media brand after YouTube, and more than 40 per cent of marketers globally believe that Instagram is among the top four platforms that deliver the highest attention. Both Instagram and Facebook feature advertising that consumers perceive to be “fun” and “entertaining”.

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