Meta Stock Plunges Amid AI Spending Plan

Meta Stock Plunges Amid AI Spending Plan

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PUBLISHED Apr 25, 2024UPDATED Apr 26

Photo: Chesnot/Contributor/Getty Images News via Getty Images

The Facts

Tech platform Meta's shares dropped nearly 19% Wednesday — wiping out around $200B in market value — after it increased its 2024 cost forecast to $35 -40B because of its ventures into artificial intelligence (AI) and its metaverse.
First quarter results for the Facebook, WhatsApp, and Instagram parent company showed its future spending rising from its earlier $30-37B range.

The Spin

Narrative A

Overall, Meta stock has surged this year. There may be some volatility caused by Wednesday's update, but that's the cost of doing business. With ad sales expected to continue growing and Zuckerberg still at the helm, Meta has a bright future.

Meta Stock Q1 Preview: Can Ads Growth Keep Up With AI Spending?

Investor's Business DailyApr 23

Narrative B

Zuckerberg and Meta's responsibility is to the shareholders, who aren't totally trustful of the near future and investment in AI. The company's lower-than-expected revenue and its announced increased spending on AI have Meta on shaky ground that may require a course correction.

Meta’s Profits More Than Double, While Spending on A.I. Rises

New York TimesApr 25

Nerd narrative

There's a 20% chance that Meta will report 1B active users by Dec. 31, 2031, according to the Metaculus prediction community.

Meta Reports 1B Active Users by 2031

MetaculusOct 28, 2022

Go Deeper

What is Artificial Intelligence?

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