Meta’s Stock Takes a Dive: AI Spending Plans Unnerve Wall Street
Meta Platforms Inc. experienced its most significant single-day loss since October 2022, as shares plunged by over 11%. This drastic drop was triggered by investor skepticism over the company’s ambitious artificial intelligence (AI) spending plans.
Despite announcing a robust Q3 2025 revenue of $51.24 billion—an impressive 26% year-over-year increase that exceeded analyst predictions—the social media behemoth’s earnings per share of $1.05 fell drastically short of the anticipated $6.70. This shortfall was primarily attributed to a one-time $16 billion tax charge.
Wall Street’s main concern, however, was Meta’s revised 2025 capital expenditure guidance. The figure was adjusted to $70-72 billion, a significant increase from the previous $66-72 billion range. CEO Mark Zuckerberg hinted that spending would grow “notably larger” in 2026.
Meta’s investment strategy heavily leans towards AI infrastructure, positioning it to compete with rivals. However, unlike its cloud-focused competitors, Meta’s approach to AI is primarily aimed at enhancing advertising performance and user engagement, rather than selling AI software to enterprises.
The stock’s fall wiped out approximately $200 billion in market capitalization, underscoring the growing demands from investors for clearer pathways to AI profitability.
Source: CNBC