Zuckerberg warned investors that Meta's AI investment will take 'several years' before it pays off. Meta's stock price tumbled.
Business InsiderApr 25
Meta Stock Plunges Amid AI Spending Plan
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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.
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.