Meta Platforms plans to invest as much as $65 billion (roughly Rs. 5,61,908 crore) on projects related to artificial intelligence in 2025, including building a giant new data center and increasing hiring in AI teams, Chief Executive Officer Mark Zuckerberg said Friday.
The company intends to use the funds to build a data center “so large that it would cover a significant part of Manhattan,” Zuckerberg said in a Facebook post. Meta plans to bring around a gigawatt of computing power online in 2025 and is projected to end the year with more than 1.3 million graphics processing units, he added.
“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 in the post.
Meta has invested significantly in AI over the last several years, and recently announced a new $10 billion (roughly Rs. 86,440 crore) data center in Louisiana. It has also bought new computer chips to power products like its AI assistant and its Ray-Ban smartglasses. Zuckerberg added that Meta will be “growing our AI teams significantly” in 2025.
Zuckerberg’s announcement comes days after OpenAI, SoftBank Group Corp. and Oracle Corp. announced a $100 billion (roughly Rs. 8,64,404 crore) joint venture called Stargate to build out data centers and AI infrastructure projects around the US.
Meta’s projected capital expenditures for this year represent a roughly 50% increase over the firm’s estimated 2024 spending, and is more than double its capital expenditures from 2023. The company is expected to provide a final 2024 capital expenditure figure when it announces its fourth-quarter financial results on January 29.
It’s possible that Meta and its competitors are overspending on AI, Zuckerberg said last summer, but the risk of losing a few billion dollars is better than missing a major change in computing.
“I think that there’s a meaningful chance that a lot of the companies are over-building now, and that you’ll look back and you’re like, ‘oh, we maybe all spent some number of billions of dollars more than we had to,’” Zuckerberg told Bloomberg’s Emily Chang in July. “On the flip side, I actually think all the companies that are investing are making a rational decision, because the downside of being behind is that you’re out of position for like the most important technology for the next 10 to 15 years.”
Wall Street was expecting Meta to allocate $51.3 billion (roughly Rs. 4,43,444 crore) for capital expenditures in 2025, according to Bloomberg-compiled estimates. Shares of Meta initially fell on the news during premarket trading, but the stock rose as much as 1.7 percent after exchanges opened in New York, reflecting optimism from analysts. Broadcom Inc., the main provider of chip design services for companies including Meta, rose as much as 3.9% following Zuckerberg’s announcement.
“Meta’s sharp increase in 2025 capital spending to as much as $65 billion (roughly Rs. 5,61,908 crore), rising well above last year’s and consensus, may be its best use of capital, driving future growth and positioning itself as a leader in AI capabilities,” Bloomberg Intelligence Senior Credit Analyst Robert Schiffman wrote on Friday.
Zuckerberg’s decision to post Meta’s spending plans on Facebook five days ahead of the firm’s quarterly earnings announcement is an unconventional one. Companies typically issue such projections alongside their financial results, or in formal regulatory filings and press releases.
But federal regulators have in the past ruled that most social media platforms are suitable for companies to use to publicly disclose material information to investors.
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