London
CNN
—
Meta stock plummets Shares soared in pre-market trading Thursday as the company's plans to “aggressively invest” in artificial intelligence surprised investors.
Meta's stock price fell about 13%, taking nearly $163 billion from its market cap as investors looked beyond the bumper first-quarter profits and focused on the company's huge costs of building its AI future. There was a risk that it would be blown away.
Meta, which owns Facebook, WhatsApp and Instagram, said Wednesday that first-quarter profit more than doubled from a year earlier, and revenue rose 27%. However, shareholders were worried as his projected AI investments increased by his $5 billion and could increase further.
“The language around spending plans is once again getting bolder and this may be spooking markets,” Sophie Rand Yates, chief equity analyst at Hargreaves Lansdown, said in a note on Thursday. Stated.
“For all of Meta's bold AI plans, we can't take our eyes off our core advertising efforts, which are at the heart of our business. Meta's resources are vast but not limitless, and its digital advertising market share is at all costs. We need to protect it,” she added.
Meta said full-year capital spending will be in the range of $35 billion to $40 billion as it continues to accelerate infrastructure spending to support AI, up from previous guidance of $30 billion to $37 billion. exceeded.
“We expect our capital spending to continue to increase next year as we invest aggressively to support our ambitious AI research and product development efforts,” the company added in a statement.
