Meta’s plan to pour over $70 billion into AI and data centers stuns investors as a major tax charge slashes quarterly profit by nearly $16 billion.
Meta Platforms has unveiled plans for a sharp increase in capital spending next year, signaling an all-out push into artificial intelligence and data infrastructure—a move that has unsettled investors despite robust revenue growth.
The company behind Facebook, Instagram, and WhatsApp reported third-quarter revenue of $51.24 billion, up 26% from a year earlier and above Wall Street forecasts. But surging costs and a steep tax expense undercut those gains. Meta’s expenses jumped 32%, and a $15.93 billion charge tied to U.S. President Donald Trump’s “Big Beautiful Bill” dragged net profit down to $2.71 billion. Without the tax hit, adjusted earnings would have reached $18.64 billion.
Shares fell 8% in after-hours trading as investors digested CEO Mark Zuckerberg’s announcement that Meta would “aggressively front-load” AI spending to prepare for potential breakthroughs in superintelligence. “It’s the right strategy to build capacity early, so we’re ready for the most optimistic timelines,” Zuckerberg said.
At the center of Meta’s expansion is Meta Superintelligence Labs, launched in June to accelerate AI research. Zuckerberg described it as having “the highest talent density in the industry,” adding that Meta is now one of the largest purchasers of Nvidia’s advanced AI chips.
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The company expects to spend between $70 billion and $72 billion this year—up from its previous estimate of up to $72 billion—and forecasts that next year’s budget will be “notably larger.” Chief Financial Officer Susan Li said much of that increase will fund new data centers and compensation for specialized AI engineers, which she identified as a key cost driver for 2026.
Meta’s escalating investments reflect a broader race among Big Tech firms such as Microsoft, Alphabet, Amazon, and OpenAI, all expanding their computing capacity to support next-generation AI models. OpenAI’s CEO, Sam Altman, recently said the firm aims to add “1 gigawatt of compute every week,” a goal that could cost more than $40 billion per gigawatt.
Analysts warn the sector’s massive outlays could form an “AI bubble” if returns fail to keep pace. “Meta’s earnings reveal the growing tension between heavy AI infrastructure spending and investor expectations for near-term profit,” said Jesse Cohen, senior analyst at Investing.com.
Still, Meta’s advertising business remains a strong performer. AI tools that automate campaigns, generate images, and enhance video quality have boosted engagement across its 3.5 billion daily users. Ad growth on WhatsApp, Threads, and Instagram Reels continues to strengthen Meta’s position against TikTok, YouTube, and Elon Musk’s X.
For the fourth quarter, Meta projects revenue between $56 billion and $59 billion—slightly above market estimates, suggesting investors may yet see the payoff of its long-term AI ambitions.