Meta Stock Plunge Sparks AI Bubble Concerns Amid Aggressive Spending Plans
Meta's shares tumbled 12% in extended trading, rattling tech investors as the company unveiled plans to escalate AI infrastructure spending to $70-$72 billion by 2025. The drop occurred despite beating Q1 earnings expectations with $7.25 EPS and 26% revenue growth to $51.24 billion.
CFO Susan Li's revised capital expenditure forecast of $116-$118 billion—up from prior guidance—triggered the selloff. Markets now question whether the AI arms race represents prudent investment or speculative excess. "We continue to lead in AI glasses," asserted CEO Mark Zuckerberg, defending the aggressive roadmap for Meta Superintelligence Labs.
The reaction mirrors growing sector-wide apprehension about unsustainable AI investment cycles. With tech earnings season amplifying these concerns, analysts see diminishing returns from ballooning R&D budgets across Big Tech.
