Meta shares plunged on as investors balked at its promise to keep spending on artificial intelligence (AI) projects while profits dwindled.
Meta pointed out that it would spend $130 billion to $145 billion this year, mostly on AI, up from the $125 billion planned to spend just three months ago.
Meta’s Chief Executive Mark Zuckerberg said the firm’s AI spending was “accelerating every part of our business” and it plans to start selling the technology to other companies.
Financial analyst Susan Li said selling its tech to other companies would help drive returns on its AI spending.
Zuckerberg has promised a smarter advertising tools, enhanced content moderation and new consumer experiences as investors appear unconvinced that the payoff will arrive quickly.
Meta’s quarterly earnings showed declining margins, with operating costs rising faster than revenue, which was $ 784 million, the lowest level in the last five years.
The company has pledged to continue heavy investment in AI, even as other tech giants adopt more cautious spending strategies, as shares have fallen sharply in trading, wiping billions off Meta’s market value.
Zuckerberg is calling on analysts with Meta’s AI abilities and models to drive engagement and boost the ability of smaller businesses to create advertising on Instagram and Facebook, adding that the company was developing AI agents or AI chatbots that act autonomously.
He added that they have agents who will work 24/7 to help sell AI models and computer tools to other firms for the first time, as they are expect to build a large business for large businesses.
