Meta Stock Tanks In Jittery Market On Massive AI Investment, Mixed Q2 - Deadline

What the report says

Deadline reported that Meta shares fell more than 8% in after-hours trading on July 29 after the company outlined a sharply higher artificial intelligence spending plan and delivered a mixed second-quarter update. The Facebook, Instagram and WhatsApp parent said it expects to invest between $130 billion and $145 billion in AI this year, while missing Wall Street’s earnings-per-share forecast and giving a softer-than-expected revenue outlook for the current quarter.

The results also showed continued strength in Meta’s advertising business. Deadline said revenue for the three months ended in June rose 28% from a year earlier to $60.8 billion, above forecasts. The article reported that ad impressions across Meta’s apps increased 14%, while the average price per ad rose 12%. Meta said AI is helping improve its core advertising operations, and CEO Mark Zuckerberg described AI as central to current products, future services and enterprise opportunities.

Investor concern focused on whether the scale of AI-related spending on data centers, chips and other infrastructure will generate sufficient returns. Deadline noted that Meta is trying to catch up with rivals including OpenAI, Anthropic and Google, and cited recent moves including a BlackRock data-center venture in El Paso, Texas, additional facilities in Louisiana and Alberta, and Meta’s investment tied to Scale AI after hiring Alexandr Wang to lead Meta Superintelligence Labs.

Deadline also placed the selloff within a broader market downturn after Federal Reserve comments unsettled investors. The report said higher-rate concerns weighed especially on large technology companies because of their heavy investment needs.