Meta’s heavy bet on artificial intelligence is rattling investors. The company reported a surge in operating costs—up $7 billion year over year—and nearly $20 billion in quarterly capital expenditures tied largely to AI talent and infrastructure, while signaling that spending will accelerate. Shares fell 12% Friday, erasing more than $200 billion in market value, as management offered few specifics on when new AI efforts would generate material revenue. CEO Mark Zuckerberg touted progress on data centers and next-generation “frontier” models under a newly formed Superintelligence Lab and pointed to a billion users of the Meta AI assistant, the Vibes video generator, and new smart glasses. But analysts questioned the absence of a breakout product or clear monetization plan. By contrast, investors have cheered rivals with visible AI payoffs—Nvidia’s infrastructure boom, Google’s cloud gains, and OpenAI’s fast-growing revenue base. Meta’s core ad business remains profitable, but the company faces mounting pressure to translate unprecedented AI capex into products that can match the scale of its spending—and to clarify whether its path runs through consumer assistants, entertainment, or enterprise tools.
Meta’s AI push lacks a killer product
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