The tech giant reported 3.56 billion Daily Active People (DAP) for the January to March quarter, a marginal 0.5% decline from 3.58 billion in Q4 CY 2025. The company defines DAP as registered and logged-in users of its Family of Apps including Facebook, Instagram, Messenger, or WhatsApp who access at least one of these platforms via mobile or web on a given day.
On a year-on-year basis, this still represents an increase of 130 million users from the 3.43 billion reported in the same quarter last year.
While the decline is marginal relative to its overall user base, Meta has attributed it to external disruptions, including internet outages in Iran and restrictions on WhatsApp in Russia. However, the lack of platform-specific data makes it difficult to determine where the user losses are most concentrated.
However, the dip may also point to deeper, structural issues in the company’s approach. It breaks a multi-quarter growth streak and could signal early signs of user saturation or churn, potentially reflecting rising dissatisfaction with its platforms even as the company ramps up spending on AI.
The user dip comes at a time when Meta is sharply increasing its investments in artificial intelligence (AI) and infrastructure. The company has raised its projected 2026 capital expenditure to between $125 billion and $145 billion, citing higher component costs and a need to expand data centre capacity after underestimating compute demand.
An internal recognition of AI’s impact on engagement is indicated in the Mark Zuckerberg-led company’s efforts to revamp its content algorithms. Particularly on Instagram, it plans to prioritise original posts and limit the reach of accounts that primarily reshare rehashed content without meaningful edits. Similar changes are being tested on Facebook, as Meta looks to improve feed quality and retain users.
Overall on the financial front, its revenue rose 33% year-on-year to $56.3 billion. However, not its Reality Labs vertical, focused on virtual reality and wearables, posted a $4.03 billion operating loss. While the company has already undergone some layoffs this year, there was a 1% increase in its headcount from last year’s same quarter. Meanwhile, the market reaction has been cautious, with Meta’s stock falling as much as 10% following the earnings release.
