S&P futures fall 0.94% as concerns over AI investment costs resurface
Key Facts
S&P 500 E-mini futures fell 0.94% on the morning of October 22, 2026, as artificial intelligence stocks came under renewed pressure following corporate earnings, according to a Reuters update. Futures were down 73.25 points at 08:38 a.m. Eastern time in an update on trading ahead of the U.S. market open. Reuters said investors focused on the rising cost of AI investments and uncertainty over when they would generate returns. The agency described the concern as "rising investment costs and an unclear timeline for returns," as corporate earnings returned to the forefront of pressure on the sector's shares. In premarket trading the same day, Meta shares fell more than 3%, according to an update published by Investing.com.
Behind the moves in Meta shares, the company reported revenue of $64.60 billion in the third quarter of 2026, up 26% year on year, according to Investing.com's coverage of its quarterly results. On spending, its capital expenditures totaled about $34.9 billion during the same quarter, according to the earnings call transcript published on the site. This amount includes finance lease principal repayments, alongside the capital expenditures the company announced in its earnings presentation. Meta said during the call that "free cash flow was negative $2.1 billion," alongside this level of spending. The quarterly results also included a $9.89 billion charge related to a settlement of lawsuits over the impact of social media on teenagers' mental health, according to the Associated Press. The settlement charge was included in the third-quarter results, which combined Meta's revenue growth with continued capital spending and negative free cash flow.
Tesla, meanwhile, said in its earnings release that total revenue reached $28,046 million in the third quarter of 2026, compared with $28,095 million in the corresponding period of 2025. The company reported the rounded year-on-year revenue change at 0%, while earnings-per-share measures showed declines from year-earlier levels. GAAP diluted earnings per share were $0.22 during the quarter, down 44% year on year, according to the release published on its investor relations website. Adjusted diluted earnings per share, meanwhile, were $0.48, down 4% year on year, a smaller decline than that recorded under the GAAP measure. On liquidity, Tesla generated positive free cash flow of $1,531 million during the third quarter. That followed negative free cash flow of $1,092 million in the second quarter, marking a return to positive cash flow compared with the previous quarter. Despite this quarterly improvement, Tesla's free cash flow remained 62% below its level in the corresponding period a year earlier, according to the same release.
On financing Meta's expansion, Chief Financial Officer Susan Li said during the earnings call that the new share class aims to "preserve founder control while expanding financing flexibility," according to the transcript published on Investing.com. Li thus linked the announcement of the new class to the company's expansion financing needs, while retaining founder-led control. For 2026, Meta narrowed its capital spending forecast to between $135 billion and $145 billion, according to the Associated Press. The previous range was between $130 billion and $145 billion, meaning the lower end of the forecast was raised while the upper end remained unchanged. On the U.S. monetary policy calendar, the Federal Reserve's published schedule sets the next Federal Open Market Committee meeting for October 27 and 28, 2026. That will be followed by publication of the meeting minutes on November 18, according to the calendar of events published on the U.S. central bank's website. The minutes are scheduled for release at 2:00 p.m. and will cover the committee's October meeting.