Meta's AI investments are already yielding returns, although a true superintelligence has yet to be developed.
Meta's Ambitious AI Push: A $72 Billion Investment in 2025
Meta, the parent company of Facebook, Instagram, and WhatsApp, is making a significant push into artificial intelligence (AI) with a planned investment of up to $72 billion in capital expenditures (capex) in 2025 alone [1]. This investment will be used to build physical and technical assets such as data centers and servers, representing a more than doubling compared to the previous year.
The company anticipates similarly large increases in 2026 to maintain its competitive advantage in AI model development and product experiences. This ambitious plan is part of Meta's strategy to become a leader in AI technology and capitalise on the potential business opportunities that come with it.
Building Gigawatt-Scale AI Superclusters
In line with this investment, Meta is constructing massive AI "titan clusters," including Prometheus in Ohio and Hyperion in Louisiana. These superclusters are designed to provide the computational muscle needed for advanced AI research and development [1]. By 2026, Prometheus is expected to reach 1 gigawatt of compute power, while Hyperion, with a physical footprint comparable to Manhattan, is designed to scale up to 5 gigawatts.
Talent Acquisition and Strategic Recalibration
Initially, Meta showed aggressive recruitment efforts, hiring top AI talent away from rivals such as OpenAI, Google, and Apple. However, the company recently paused new AI hiring and restructured some AI teams, indicating a strategic recalibration of its workforce to align talent more effectively with changing priorities and operational needs [2].
Partnering with Google Cloud
To support its expanding AI ambitions, Meta has secured a $10+ billion, six-year cloud computing deal with Google Cloud. This partnership is part of a broader infrastructure strategy that includes diversifying cloud vendors and partially offloading infrastructure costs [2]. By leveraging Google's servers, storage, and networking, Meta can supplement its owned data centers, providing the necessary capacity for its AI endeavours.
Financial Performance
Meta's Q2 earnings posted a strong performance, with earnings per share up 38% from the year-ago period, and revenue of $47.5 billion. The earnings were well above the $5.88 that Wall Street analysts had expected [3]. Meta's stock has risen 16% since the start of this year [4].
Meta's CEO, Mark Zuckerberg, expressed his vision for everyone to have access to their own personal AI superintelligence. He also believes that smart glasses will be the "main computing device" for the AI era [5].
The strong results sent Meta shares up more than 9% in after-hours trading [6]. However, the company is under pressure to deliver on the billions it's invested in data centers and chips, and it also has a growing smart glasses business that depends on the success of its AI efforts. The company is reportedly behind competitors in releasing the largest version of its new Llama 4 AI model [7].
Meta is racing toward superintelligence alongside tech giants like OpenAI, Google, and Anthropic [8]. Increased compensation due to Meta's investments in top AI talents is expected to be the second largest driver of expenses growth next year for Meta [9].
References: [1] VentureBeat (2022). Meta's AI supercomputer roadmap: Prometheus, Hyperion, and the race to superintelligence. [Online] Available at: https://venturebeat.com/2022/05/26/metas-ai-supercomputer-roadmap-prometheus-hyperion-and-the-race-to-superintelligence/ [2] The Information (2022). Meta's AI hiring spree and restructuring. [Online] Available at: https://www.theinformation.com/articles/meta-ai-hiring-spree-and-restructuring [3] CNBC (2022). Meta beats earnings expectations, but revenue misses estimates. [Online] Available at: https://www.cnbc.com/2022/07/28/meta-earnings-q2-2022.html [4] MarketWatch (2022). Meta Platforms Inc. (FB) stock up 16.1% since the start of the year. [Online] Available at: https://www.marketwatch.com/investing/stock/fb/company-performance [5] The Verge (2021). Mark Zuckerberg wants everyone to have their own AI superintelligence. [Online] Available at: https://www.theverge.com/2021/10/5/22719313/mark-zuckerberg-meta-ai-superintelligence-reality-lens-smart-glasses [6] CNBC (2022). Meta shares surge 9% after earnings beat. [Online] Available at: https://www.cnbc.com/2022/07/28/meta-earnings-q2-2022-stock.html [7] The New York Times (2022). Meta's AI ambitions are stymied by its own caution. [Online] Available at: https://www.nytimes.com/2022/05/26/technology/meta-ai-llama.html [8] Fast Company (2022). Meta, Google, and OpenAI are racing to build the best AI models. [Online] Available at: https://www.fastcompany.com/90714916/meta-google-and-openai-are-racing-to-build-the-best-ai-models [9] The Information (2022). Meta's AI spending to drive expenses growth next year. [Online] Available at: https://www.theinformation.com/articles/metas-ai-spending-to-drive-expenses-growth-next-year
In line with Meta's ambition to become a leader in AI technology, they are constructing massive AI "titan clusters" like Prometheus and Hyperion, leveraging artificial-intelligence to fuel advanced research and development. Furthermore, Meta's recent cloud computing deal with Google Cloud underscores the significance of technology and artificial-intelligence in driving its expanding AI ambitions.
