Meta Stock Crashes Amid AI Spending Fury
Meta Platforms Inc. (NASDAQ: META) saw its stock plunge 15% in after-hours trading following a disastrous earnings call. The catalyst? CEO Mark Zuckerberg’s $40 billion AI investment spree—with little to show for it. Investors are now questioning whether Meta’s AI gamble is visionary or reckless.
Zuckerberg’s $40B AI Bet Backfires
Meta’s aggressive AI spending dominated its Q4 earnings report, revealing:
– $40B+ poured into AI and metaverse projects in 2023
– $13.7B lost in Reality Labs (metaverse division)
– Weak returns from glitchy AI chatbots and ad tools
Analysts cite failed AI experiments, including:
– Meta AI assistant (ridiculed for bizarre responses)
– Horizon Worlds (low engagement, “ghost town” reputation)
– AI ad tools (brand safety scandals)
Investors Demand Accountability
Wall Street’s reaction was brutal, with shares hitting a multi-month low. Key concerns:
– “No clear ROI” on AI projects (Bernstein analyst)
– Core ad business threatened by TikTok, Google
– Boardroom tension over unchecked spending
Can Zuckerberg Salvage Meta’s AI Dream?
Despite backlash, Zuckerberg insists “we’re playing the long game.” But pressure is mounting for:
1. Pivoting back to ads/social media
2. Scaling back metaverse losses
3. Proving AI can boost revenue
Big Tech’s AI Arms Race
Meta’s crisis mirrors Silicon Valley’s AI frenzy—but rivals like Microsoft and Google are seeing faster payoffs. Without a turnaround, Meta risks falling behind in the AI revolution it helped fuel.
What’s next? Will Zuckerberg curb spending, or double down? Share your take below.
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