Meta Could Spend $145 Billion This Year Due to AI
Meta's $145B AI bet sends shares down 7% despite 33% revenue jump.
Meta's massive AI spending spree dominated earnings day, with the company revealing 2026 capital expenditures could hit $145 billion — double last year's $72 billion. While revenue surged 33% (fastest since 2021), shares fell over 7% as investors balked at the escalating costs. CEO Mark Zuckerberg attributed the increase to higher component prices, especially memory chips, driven by the global AI data center buildout that's also raising prices on consumer electronics like laptops and smartphones.
Zuckerberg is doubling down on AI after the Metaverse's $80 billion+ loss over six years, with Reality Labs posting another $4 billion quarterly operating loss on just $402 million in sales. The bet's first fruit is Muse Spark, an open-source AI model from the new Meta Superintelligence Labs led by Scale AI's Alexandr Wang. Meta is also testing business AI agents (weekly conversations up 10x since January), using AI to dub videos for 500M+ weekly users, and hyper-personalizing feeds. To offset costs, Meta is laying off 10% of its workforce as CFO Susan Li cites a 'leaner operating model.'
- Meta's 2026 capex could hit $145B, up from $72B in 2025, driven by AI data center memory chip costs
- Shares fell 7%+ despite 33% revenue growth, as investors worry about ROI after Metaverse's $80B+ loss
- New AI model Muse Spark and business agents show early promise, with weekly AI agent conversations up 10x
Why It Matters
Meta's record AI spend signals a high-stakes pivot from Metaverse failure, reshaping data center economics and memory chip markets.