Meta To Spend Up To $65bn On AI This Year

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Meta plans to spend up to $65bn on AI infrastructure this year, as it faces competition from rival companies and ‘Stargate’ initiative

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Meta Platforms plans to increase its spending on artificial intelligence (AI) infrastructure to around $60 billion (£48bn) to $65bn in capital expenditures in 2025, the company said, as it faces intense competition from rival tech giants.

The company is building a large 2-gigawatt data centre that “would cover a significant part of Manhattan” to power its AI offerings, said chief executive Mark Zuckerberg on social media.

He said the firm expects to add around 1 GW of computing power this year and to end the year with more than 1.3 million graphics processing units.

“This is a massive effort, and over the coming years it will drive our core products and business, unlock historic innovation, and extend American technology leadership,” Zuckerberg wrote, calling 2025 “a defining year for AI”.

A sign for Meta's Facebook social media platform
Image credit: Unsplash

AI investment

He said he hopes Meta’s AI assistant will become the “leading assistant” with more than 1 billion users this year, up from around 600 million monthly active users last year.

The projected figures are significantly above Meta’s estimated $38bn to $40bn in capital expenditure last year, and is above LSEG analysts’ estimates of $50.25bn for this year.

Zuckerberg also said it was increasing hiring for AI roles and was developing an AI-powered virtual engineer that would contribute “increasing amounts of code to our R&D efforts”.

“We have the capital to continue investing in the years ahead,” he wrote.

The company’s shares rose by 1.73 percent on Friday following the announcement to close at a record high of $647.49.

Zuckerberg told investors last April that he expected a “multiyear investment cycle” before Meta’s AI spending would result in profits, causing Meta’s shares to plunge 16 percent.

Competition

Meta’s announcement comes days after US president Donald Trump last week announced that ChatGPT developer OpenAI, SoftBank, Oracle and Saudi Arabia sovereign wealth fund MGX were forming a venture called Stargate to invest $500bn into AI infrastructure across the US.

The Stargate announcement “created urgency” for other tech companies to send a “message” and show that they are also planning significant AI investments, said DA Davidson analyst Gil Luria.

Microsoft earlier this month it was planning to spend $80bn on data centres in fiscal 2025, while Amazon.com said its 2025 capital spending would be higher than an estimated $75bn last year.

Earlier in January Meta confirmed it planned to cut 5 percent of its staff this year in what the company framed as an initiative to boost employee performance.

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