Reports that Meta Platforms (META +2.06%) has signed a "multi-year" deal to secure flash memory from Sandisk (SNDK +12.30%) sent Sandisk stock flying -- and Meta stock dying -- early this morning. Meta stock initially fell 4% on the news, before recovering.
As of 11:40 a.m. ET, Meta stock is back in the green, up 0.5%.
Image source: Getty Images.
Details, please Citing internal Meta documents, Reuters reports the social media giant will buy NAND from Sandisk, DRAM from Samsung, and fiber optics from Sumitomo as it builds out its very own artificial intelligence computing infrastructure.
Additional beneficiaries may include Broadcom (AVGO +4.51%), which is helping Meta design Iris AI semiconductors for its data centers, and also Taiwan Semiconductor Manufacturing (TSM +0.83%), which will contract-manufacture these AI chips.
All these companies are declining to officially confirm the details of the Reuters report. Regardless, investors are "buying the rumor" and shares of all the U.S. publicly traded stocks named -- Sandisk, Broadcom, and TSMC -- are moving higher today.
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Why Meta stock is slumping Meta stock, on the other hand, is not moving higher, or at least not much. Indeed, Meta stock initially sold off on this news.
Why is that? Consider that Meta has plans to spend $145 billion on AI infrastructure this year, and today's Sandisk news seems to confirm this plan is on track. On the one hand, that kind of money will buy Meta a lot of AI capacity as it competes with the likes of Alphabet, OpenAI, and Anthropic. On the other hand, $145 billion is even more than the $136.6 billion Meta is expected to bring in via cash from operations this year, according to data from S&P Global Market Intelligence.
Meta's skating close to the edge these days, and if that makes investors nervous, I totally understand.
Rich Smith has positions in Meta Platforms. The Motley Fool has positions in and recommends Broadcom, Meta Platforms, and Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy.
SummaryMeta Platforms is reportedly soon entering into the cloud computing provider business, positioning itself as a formidable AI infrastructure cloud.META's AI-driven ad tools and compute expansion could unlock significant monetization and margin improvement opportunities. The market is clearly underestimating its prowess.The stock trades at under 19x forward earnings, below peers, despite anticipated growth inflection from compute partnerships and AI advancements.I expect META's next step into the compute business and plausible Anthropic partnership could catalyze a rerating toward all-time highs.If you've been waiting for a chance to double down on Meta, you might not find a better opening to do so.Looking for a helping hand in the market? Members of Ultimate Growth Investing get exclusive ideas and guidance to navigate any climate. Learn More » panida wijitpanya/iStock Editorial via Getty Images
Finally, Meta is reportedly selling compute Finally, Meta CEO Mark Zuckerberg has understood the importance of having a cloud computing business, as Meta (META) has reportedly been looking to sell compute for the first time.
I'm not sure how long
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Analyst’s Disclosure: I/we have a beneficial long position in the shares of META, GOOGL either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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In a bid to lower its GPU costs amid an unprecedented component shortage, Meta is on track to start making the latest versions of its AI-specific chip in September, Reuters reported, citing an internal memo.
At least one chip sailed through its testing phase in about six weeks, the memo said. Meta is working with Broadcom on the chip design, but it will use Taiwan Semiconductor Manufacturing Company (TSMC) to manufacture them. It is also buying RAM from Samsung, storage from Sandisk, and fiber-optic equipment from Sumitomo Electric, according to the report.
Meta detailed the four new chips, developed under its Meta Training and Inference Accelerator (MTIA) program, in March, some of which are currently in deployment or will be this year or next. The company is taking a modular approach to designing these chips, anticipating that their needs will change as AI evolves rapidly by the time the chips are in production.
“Each MTIA generation builds on the last, using modular chiplets, incorporating the latest AI workload insights and hardware technologies, and deploying on a shorter cadence,” the company wrote at the time.
The chips are expected to help the company save on buying GPUs from chipmakers like Nvidia and AMD, although it still expects to spend plenty with those providers as well, Reuters reports. Meta intends to use the MTIA chips for training models for its ranking and recommendation algorithms, broader AI workloads, and inference aimed at its applications. The social media company has been producing its own AI chips since 2023.
Meta has been spending massively on securing enough compute capacity to power its various AI efforts. The company in April said it expects capital expenditures between $125 billion and $145 billion this year, a lot of which is going toward its AI efforts.
The company has been striking data center and power deals across the world, spending tens of billions to secure computing capacity to train and deploy its new Muse Spark series of AI models. It plans to deploy 7 gigawatts of compute this year, and double that next, according to Reuters, which cited the memo.
It also signed a deal with ARM last year to secure compute for its recommendation systems, in addition to a multibillion-dollar deal with AMD for its Instinct GPUs and a multibillion-dollar deal with Amazon to use the cloud giant’s homegrown CPUs for AI-related needs.
Meta isn’t the only company trying to stem the tide of capital going to Nvidia. OpenAI last month unveiled an inference processor that it is building with Broadcom, and Anthropic is said to be considering developing its own chips with Samsung. Amazon and Google both develop their own chips for AI training and inference, and there’s a host of startups building in the space to meet skyrocketing demand.
Meta declined to comment.
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Ram is a financial and tech reporter and editor. He covered North American and European M&A, equity, regulatory news and debt markets at Reuters and Acuris Global, and has also written about travel, tourism, entertainment and books.
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Meta Platforms (META) introduced Muse Spark 1.1 on Thursday, calling the new AI model a major upgrade as Mark Zuckerberg pushes harder against Google (GOOG), Op
Meta launches a new AI coding model with 'very aggressive' pricing, CEO Mark Zuckerberg says By You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.
Meta CEO Mark Zuckerberg. Chris Unger/Zuffa LLC Meta could spark a price war in the booming AI coding market.
The tech giant announced its latest AI model, Muse Spark 1.1, on Thursday, saying it performs well on industry tests for coding and AI agents. It's Meta's first AI model that it charges users for.
In comments on X, Meta CEO Mark Zuckerberg said the model has a "very low price," though the company hasn't announced the cost yet. He also called out other AI companies for pricing their chatbots at "very extreme" levels in comments to Bloomberg. He told Bloomberg that the model outperformed Google's Gemini in several categories, including agents, coding, and other capabilities.
"We think that there's a real ability to be able to offer frontier or very high-level intelligence at a much more affordable cost," Zuckerberg told the outlet.
The model, which isn't fully available to developers yet, marks the latest milestone for Meta's AI efforts — and shows the company intends to compete on price.
If Meta's new AI models can compete with widely-used coding tools from rivals like Anthropic, OpenAI, and Cursor, that could represent a huge new source of revenue. Meta's stock was up nearly 2% on Thursday.
The cost of using AI has become a growing concern for companies as employees incorporate the technology into more of their day-to-day work. Companies have been throttling their employees' use of AI in recent months as vibe coding takes off. Coinbase, for example, now limits its engineers' weekly AI spending to $500 to $5,000 a week.
Meta quoted one of its customers, AI coding startup Cline, saying that the new AI model's price point makes it easy to run heavy AI coding tasks at scale.
"That combination is rare, and it's exactly why we wanted Cline developers to have access early," Saoud Rizwan, the Cline CEO, said on Meta's website.
Meta is spending massive amounts of cash on AI, raising its capital expenditure guidance for this year to $125-$145 billion, up from a previous estimate of $115-$135 billion. Meta remains highly dependent on its ads business, which accounts for about 98% of its total revenue, according to its first-quarter earnings results.
"We believe Meta is well positioned to generate ample revenue to support its spending, driven by monetization of its own AI initiatives, advertising share gains, incremental subscription revenue, an optionality of cloud offering, and fees for external use of its AI models," BNP Paribas Equity Research senior analyst Nick Jomes wrote in a note to investors on Thursday.
Meta is also working on a coming AI model codenamed "Watermelon," which its AI chief Alexandr Wang says has caught up to one of the latest versions of OpenAI's ChatGPT.
The model uses "an order of magnitude" more computing power than Meta's previous model, Wang told staff last week, Business Insider reported earlier.
Meta didn't respond to a request for comment.
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Charles Rollet is BI's tech correspondent in San Francisco. Prior to joining BI, Charles worked at TechCrunch covering startups and VC. Charles is based in the Bay Area, where he enjoys hiking with his dogs. You can contact Charles securely on Signal at charlesrollet.12 or +1-628-282-2811.
It's Thursday, 2 p.m., and do you know where the Nasdaq is?
It's up a respectable 1.2% -- but the Direxion Daily Semiconductor Bull 3X Shares ETF (SOXL +13.09%) is up much, much more, surging past 14.1% on some billion-dollar-plus news items in semiconductors today.
Image source: Getty Images.
Micron boosts the market The first news comes from Micron (MU +7.10%) stock, which is surging nearly 8% after announcing it's investing up to $3 billion "to strengthen the U.S. semiconductor supply chain ecosystem," including by loaning GlobalWafers Co., Ltd. $500 million to help build its 300mm raw silicon wafer manufacturing facility in Sherman, Tex., and its signing a 10-year deal to buy the wafers GlobalWafers churns out.
In related news, Reuters is reporting that Meta Platforms (META +2.07%) has signed a multi-year supply agreement to source NAND flash memory for its data centers from Sandisk (SNDK +12.30%), and is also buying DRAM from Samsung, and fiber optic cables from Sumitomo Electric, and Iris artificial intelligence chips from Taiwan Semiconductor Manufacturing (TSM +0.83%) -- with Broadcom (AVGO +4.51%) doing the chip design work.
It's all part of a Meta plan to spend $145 billion building out AI infrastructure this year alone.
3x the risk, 3x the gain Think all the above might be enough to get semiconductor investors excited? Today it is, for sure. And several of the companies making headlines today -- Micron, Broadcom, and Taiwan Semiconductor Manufacturing -- are components of the Direxion Daily Semiconductor Bull 3X Shares ETF, too.
Their share price gains directly translate into upwards momentum for the ETF, and once 3x'ed... well, that's how you take a 1.2% Nasdaq gain, and parlay it into a 14.1% skyrocket for this heavily leveraged bet on semiconductor stocks.
Rich Smith has positions in Meta Platforms. The Motley Fool has positions in and recommends Broadcom, Meta Platforms, Micron Technology, and Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy.
Mark Zuckerberg’s Meta plans to design its own artificial intelligence chips in-house starting in September – part of an industry-wide effort by the biggest names in AI to start making their own chips amid ongoing high demand.
Zuck’s initiative, known internally as “Iris,” centers on developing custom silicon to supercharge the AI systems behind Facebook and Instagram, Reuters reported Thursday.
The social media giant — which expectes to spend up to $145 billion on AI infrastructure this year — is working with Palo Alto, Calif.-based Broadcom on design and Taiwan Semiconductor Manufacturing on production.
Meta wants to use custom chips to supercharge its social platforms, including Instagram. ink drop – stock.adobe.com Meta joins a growing list of technology companies seeking to handle more of their chip development internally to cut costs and reduce dependence on Nvidia, which has dominated the AI chip business with its ultra-powerful semiconductors.
Even as Meta and other companies are launching their foray into chip building, the semiconductor industry remains under tremendous demand strain, and AI companies’ efforts to become more autonomous provides no silver bullet to the supply chain conundrum.
Demand for manufacturing, packaging and other chip production resources continues to outpace supply, while several specialized chip-making processes are controlled by a small number of companies already operating at capacity even as they invest mountains of capital to expand.
Meta’s latest project builds on a long-running effort to develop its own chips. Its Training and Inference Accelerators program, launched more than five years ago, has focused on in-house chip development, though progress has been slow.
Development of the new chip has reportedly moved much more rapidly. Testing took just six weeks and faced no major problems, according to Reuters. Meta plans to introduce a new chip roughly every six months through 2027, compared with the typical annual-or-longer release cycle for AI chips.
Meta is aiming to double its computing infrastructure in 2027, according to Reuters.
The custom product is intended to complement the large number of graphics processing units, or GPUs, that Meta buys from Nvidia and AMD for AI workloads.
Mark Zuckerberg’s chip initiative is intended to reduce Meta’s reliance on Nvidia and cut costs. CQ-Roll Call, Inc via Getty Images But bringing the newest GPUs online at Meta’s scale “has been a heavy lift, and it has cost us time,” according to a company memo reviewed by Reuters.
Developing custom chips can potentially lower costs and diversify supply chains, Axios noted.
“I want something in my pocket when I’m sitting across the table from Jensen negotiating,” Bernstein senior analyst Stacy Rasgon told the outlet, referring to Nvidia CEO Jensen Huang.
In addition to Meta, Amazon, Google and Microsoft all have in-house chip programs. OpenAI recently introduced its first custom inference chip with Broadcom, while Anthropic is reportedly in talks with Samsung about developing its own chip.
Nvidia, led by Jenson Huang, dominates the AI chip industry. Getty Images Apple announced this week that it plans to spend more than $30 billion with Broadcom over the next five years, helping the chipmaker expand a manufacturing facility in Fort Collins, Colo.
The consumer tech giant already designs its own chips for the iPhone, iPad and Mac, and is reportedly developing separate processors for AI servers.
Samsung manufactures advanced chips for both its own products and outside customers, while Intel is working to expand its contract manufacturing business after its production technology fell behind in recent years, Axios noted.
Showing the complexity of attaining chip autonomy, those manufacturers rely on lithography equipment from Dutch company ASML — the only supplier of the most advanced machines used to produce AI chips, per the news site.
The Post has sought comment from Meta, Broadcom and Taiwan Semiconductor Manufacturing.
In this video, I will cover a major update from Meta Platforms (META +2.05%) and explain why the market's reaction may be sending the wrong signal to investors. Watch the short video to learn more, consider subscribing, and click the special offer link below.
*Stock prices used were from the trading day of July. 8, 2026. The video was published on July. 8, 2026.
Neil Rozenbaum has positions in Meta Platforms. The Motley Fool has positions in and recommends Meta Platforms. The Motley Fool has a disclosure policy. Neil is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
This has been a forgettable year for Meta Platforms (META 2.50%) investors so far. Shares of the tech giant are down 5% as of this writing, underperforming the tech-laden Nasdaq Composite index that has logged 11% gains in 2026.
Concerns about Meta's aggressive capital spending on artificial intelligence (AI) projects and the potential returns of these investments have weighed on its stock price this year. However, the Magnificent Seven stock jumped nearly 9% on July 1 after a report emerged that it may be entering the lucrative AI cloud market.
Let's see what this potential move may mean for Meta stock.
Image source: The Motley Fool.
Meta Platforms can unlock a multibillion-dollar opportunity with this move According to Bloomberg News, Meta Platforms is planning to sell its excess AI cloud computing capacity to customers. It was easy to see why this report gave Meta stock a big boost. The company is on track to spend $135 billion in capital expenditure this year at the midpoint of its guidance range, up significantly from $72.2 billion last year.
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Meta has been spending heavily to integrate AI tools across its applications and advertising offerings, as well as to build frontier AI models (the most advanced kind of foundational AI models) through its Superintelligence Labs division. The good news is that these investments are driving tangible gains for Meta.
The company's Muse Spark advanced AI model, which is the first one to be launched by Meta Superintelligence Labs and powers the Meta AI assistant, has led to a double-digit percentage increase in user sessions on Meta AI. Additionally, the Meta AI business assistant is resolving its clients' issues at 20% faster, while the number of advertisers using the company's generative AI creative tools now stands at more than 8 million.
Meta is also pushing the envelope in AI wearables. The daily users of its AI glasses doubled year over year in Q1. Still, the toll that Meta's heavy spending may take on its bottom line has got the market worried. So, when reports emerged that this tech giant would start selling its AI cloud excess capacity, investors heaved a sigh of relief.
This will allow Meta to monetize the unused cloud computing capacity in its inventory, mitigating Wall Street's worries that it is overspending on AI infrastructure. This could be a smart move if Meta indeed decides to rent out excess infrastructure. Also, Bloomberg News reports that Meta will offer access to its AI models to customers renting AI compute capacity, in addition to raw compute capacity to run their own models and applications.
Meta, therefore, could be poised to enter the massive AI cloud market that's expected to generate $267 billion in revenue in 2030, according to Gartner. Entering this market will supercharge Meta's already impressive growth. The company's Q1 revenue increased 33% year over year to $56.3 billion. However, aggressive capital spending resulted in a smaller 14% increase in its adjusted earnings per share (after excluding the one-time income tax benefit of $3.13 per share).
However, as Meta's investments in AI infrastructure start paying off, its bottom-line growth should also accelerate, following an estimated 8.5% jump in 2026.
Data by YCharts
Also, if Meta enters the cloud AI market like other Magnificent Seven companies, it could clock faster growth than Wall Street's expectations.
The stock's valuation and upside potential make it a no-brainer buy Meta's underperformance this year explains why the stock is trading at attractive levels. It has a trailing earnings multiple of 21, a significant discount to the Nasdaq Composite's earnings multiple of 39. Of course, Meta's tepid earnings growth explains why it is cheap right now. However, a potential acceleration in growth could eventually lead the market to reward it with a higher valuation, resulting in more upside.
On the other hand, Meta is trading at 7 times sales, a slight premium to the Nasdaq Composite's average sales multiple of 5.3. The gains that Meta's AI tools are bringing for advertisers, along with its reported entry into AI cloud infrastructure, could help it exceed Wall Street's growth estimates over the next three years.
Analysts are anticipating a 26% jump in Meta's revenue this year. That's expected to be followed by healthy double-digit growth in 2027 and 2028, albeit at a slower rate.
Data by YCharts
Meta could exceed those numbers, especially given its growing share of the digital ad market. According to eMarketer, Meta's digital ad market share could hit 27% in 2026, surpassing Google. This indicates that the integration of AI tools into Meta's advertising platform is paying off. Given that the digital ad market's revenue is expected to surpass $1.5 trillion in 2030, there is a strong likelihood of Meta cruising past consensus revenue estimates.
But even if it generates $354 billion in revenue in 2028 and maintains its 7x sales multiple, its market cap could jump to $2.5 trillion. That suggests a potential 60% upside over three years, which is why investors should consider buying this AI stock while it trades at attractive levels.
Key Takeaways Meta is building a $9B Alberta data center as part of its aggressive AI infrastructure expansion.A cloud business could help Meta monetize AI investments and reduce its reliance on advertising.Heavy AI spending, rich valuation and execution risks may make a better entry point worth waiting for. Meta Platforms (META - Free Report) has built one of the world's most profitable digital advertising businesses. Nearly 98% of its revenues still comes from ads, while artificial intelligence (AI) has helped improve content recommendations, advertising performance and user engagement across its apps.
But the company is thinking beyond advertising and is laying the groundwork for its next phase of growth. In the latest infrastructure push, Meta is building its first data center outside the United States—a 1-gigawatt facility in Alberta, Canada, expected to cost about $9 billion. That would be the company’s 33rd data center. Separately, reports indicate Meta is exploring a cloud computing business by potentially renting excess computing capacity or offering AI services to outside customers.
Over the past year, META stock has underperformed the broader industry and peers like Amazon (AMZN - Free Report) and Alphabet (GOOGL - Free Report) but has surpassed Microsoft (MSFT - Free Report) .
1-Year Price Performance Comparison Image Source: Zacks Investment Research
Do Meta's aggressive AI infrastructure investments and potential cloud plans strengthen its long-term investment case? And is META stock a buy at current levels?
The AI Infrastructure Build-Out ContinuesMeta's Alberta facility is the latest step in the company's AI infrastructure expansion. As AI models become larger and more compute-intensive, Meta is rapidly adding data center capacity to support growing demand for AI infrastructure and services.
Alberta offers several advantages for such a project, including abundant energy, industrial land and a business-friendly regulatory environment. The data center is also expected to create more than 3,000 construction jobs at its peak, while supporting local infrastructure and community investments.
Meta is building this infrastructure to train and deploy its Llama AI models and power AI experiences across Facebook, Instagram, WhatsApp, Messenger and Threads.
Meta is not alone. Amazon, Microsoft and Alphabet are also investing on a huge scale in AI infrastructure and data centers to meet surging demand for generative AI.
Could Meta Become the Next Cloud Provider?Alongside its infrastructure expansion, Meta is reportedly evaluating another opportunity—cloud computing.
Per Bloomberg reports, the company is debating whether to offer customers access to AI models hosted on its infrastructure or simply rent out excess computing capacity. If launched, the business would compete with Amazon Web Services, Microsoft Azure and Google Cloud, which have become major revenue contributors for Amazon, Microsoft and Alphabet, respectively.
For investors, the significance lies in diversification. Meta has invested significantly in AI infrastructure over the past several years. A cloud business could provide another way to generate returns from those investments while reducing the company's overwhelming dependence on advertising.
However, cloud computing also comes with challenges. Unlike advertising, cloud infrastructure is a lower-margin business that requires significant investments in servers, networking, enterprise sales and customer support. Alphabet offers a useful example. While Google's advertising business enjoys operating margins above 40%, Google Cloud took years to become profitable and still operates at much lower margins. If Meta eventually enters the cloud market, investors should expect greater revenue diversification, but potentially lower overall profitability.
AI Is Already Strengthening Meta’s Core BusinessMeta is already benefiting from its AI investments. Instagram Reels watch time increased 10% globally during the first quarter of 2026, while Facebook video watch time rose 8%. AI-translated videos are now watched weekly by more than 500 million users across Facebook and Instagram. Threads also surpassed 500 million monthly active users.
Meta's ecosystem remains one of its biggest competitive advantages. More than 3.56 billion people use at least one of its apps every day, giving the company enormous amounts of data to improve AI models and deliver better advertising results.
The company is also expanding monetization opportunities through paid messaging on WhatsApp, subscription offerings across Facebook, Instagram and Meta AI, and new AI tools such as Muse Image.
Meta’s Elevated Spending Remains a ConcernWhile Meta is seeing tangible benefits from AI, the cost of building that advantage remains a key concern. Its aggressive AI spending has raised investor concerns, as the financial returns from these massive investments are likely to take time to materialize.
Meta now expects 2026 capital expenditures between $125 billion and $145 billion, above its previous guidance, while operating expenses are projected between $162 billion and $169 billion. This is expected to put pressure on free cash flow and near-term earnings.
Meta is not alone in this spending race. Alphabet raised its 2026 capital expenditure outlook to $180-$190 billion, reflecting higher AI compute demand and additional investments tied to the Wiz acquisition. Microsoft expects to invest roughly $190 billion during fiscal 2026, while Amazon plans to spend around $200 billion and continues investing aggressively to expand AWS and its AI infrastructure.
META Valuation CheckMETA stock is trading at a premium valuation. Its forward 12-month P/S of 5.45X is above the Zacks Internet Software industry's 3.89X. The stock also carries a Value Score of C.
Image Source: Zacks Investment Research
How to Play META Stock NowMeta is making the right long-term strategic bets, but investors may have to wait longer for those investments to deliver meaningful financial returns. The stock has a rich valuation, and heavy AI spending is likely to weigh on free cash flow and earnings over the near term. Although Wall Street's consensus price target implies roughly 37% upside from current levels, that potential is accompanied by significant execution risk.
Image Source: Zacks Investment Research
Existing shareholders can continue to hold the stock for its long-term AI potential, but new investors may be better off waiting for a more attractive entry point. META currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
While the company continues rolling out consumer-facing AI products—including the recently introduced Muse Image and upcoming Muse Video models—Meta has also been quietly embedding artificial intelligence throughout its own operations, particularly inside its engineering organization.
Meta Is Using AI To Build MetaMeta’s internal AI push extends well beyond public-facing products.
According to reports, the company has set ambitious internal goals for AI-assisted software development, encouraging engineers to adopt coding tools such as DevMate, Metamate and Google’s Gemini. Some engineering teams have targets for AI to assist with the majority of their code changes, while Meta has also pushed broader adoption of AI tools across its technical workforce.
Separately, Meta has been consolidating many of its workplace AI capabilities into Metamate, its primary internal enterprise AI assistant. The company has said it wants Metamate to become the starting point for a wide range of employee tasks—from conducting research and prototyping new features to preparing presentations and coordinating work across teams.
Why Investors Should CareThe strategy highlights a different way to think about AI returns. Rather than measuring success solely by chatbot users or subscriptions, investors may also want to consider how artificial intelligence improves Meta’s own productivity.
Engineering talent represents one of the company’s largest operating expenses. If AI helps developers write code faster, automate routine tasks or shorten product development cycles, Meta could improve the return on one of its biggest investments without adding new revenue streams.
That’s a different kind of AI payoff—one driven by operating leverage rather than direct monetization.
Investment TakeawayMeta’s consumer AI products will continue to attract headlines, and Muse Image is the latest example of the company’s push to expand AI across Facebook, Instagram, WhatsApp and its Meta AI assistant.
But the company’s internal AI strategy may prove just as significant.
By integrating tools like DevMate and Metamate into everyday engineering and workplace workflows, Meta is betting that AI won’t just build better products—it will help build a more productive Meta. For long-term investors, that could make the company itself one of the biggest beneficiaries of its own AI revolution.
Image by Tada Images via Shutterstock
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In this video, I will cover recent Meta (META +2.05%) news and explain the ripple effect it could have on Nebius, CoreWeave, and the broader AI infrastructure trade. Watch the short video to learn more, consider subscribing, and click the special offer link below.
*Stock prices used were from the trading day of July. 2, 2026. The video was published on July. 2, 2026.
Neil Rozenbaum has positions in CoreWeave, Meta Platforms, and Nebius Group. The Motley Fool has positions in and recommends Meta Platforms. The Motley Fool has a disclosure policy. Neil is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
Meta Platforms Inc (NASDAQ:META, XETRA:FB2A, SIX:FB)’s Meta Superintelligence Labs on Thursday announced the launch of Muse Spark 1.1, an updated multimodal reasoning model designed for advanced artificial intelligence workflows, including autonomous agent tasks, coding and computer-use applications.
The release expands Meta’s push into the enterprise AI market, with the company also opening a public preview of the Meta Model API, allowing external developers to access Muse Spark 1.1 for the first time.
Meta said Muse Spark 1.1 features a one-million-token context window and improvements in tool use, multimodal reasoning and coding performance.
The company positioned the model as capable of handling complex workflows by operating within multi-agent systems, where it can act as both a primary agent coordinating tasks and a subagent completing specialized assignments.
The model is currently available in “Thinking” mode through the Meta AI app and meta.ai, while developers can access it through the Meta Model API.
According to Meta, Muse Spark 1.1 is designed to manage long-running tasks by retaining relevant context, retrieving information from earlier parts of a workflow and coordinating actions across multiple tools. The company said the model can navigate computer interfaces, automate tasks, write scripts when appropriate and adapt to changing requirements during extended sessions.
Meta also highlighted improvements in software development capabilities, saying Muse Spark 1.1 can assist with debugging, feature development and large-scale code migrations. Internal testing on the company’s Meta Internal Coding Bench showed improvements over the previous Muse Spark model and competitive performance against other leading AI systems, Meta said.
The company added that Muse Spark 1.1 offers expanded multimodal capabilities, including the ability to interpret images, video and other visual information while using those inputs in agent-driven tasks.
Meta said the model underwent safety evaluations focused on areas including cybersecurity, chemical and biological risks, and potential loss-of-control scenarios before deployment. The company reported that the model remained within its safety thresholds across those evaluations.
Shares of Meta were little changed at $605 following the update, having fallen more than 8% so far this year.
Meta Platforms Inc. META shares traded higher on Thursday, reversing early losses as investors assessed the company's latest artificial intelligence initiatives.
This includes plans to begin manufacturing an in-house AI chip and the public preview of its upgraded Muse Spark 1.1 model.
The developments show Meta's efforts to strengthen its AI infrastructure, reduce reliance on third-party chip suppliers, and expand its portfolio of proprietary AI products as competition with OpenAI, Anthropic and Google intensifies.
According to an internal memo reviewed by Reuters, Meta plans to begin manufacturing its in-house artificial intelligence chip, code-named Iris, from September.
The chip is part of the company's four-generation Meta Training and Inference Accelerators (MTIA) program and is designed to improve the AI systems powering Facebook and Instagram.
Reuters reported that testing of the chip took just six weeks and uncovered no major issues, marking progress for an in-house chip initiative that has faced challenges since it began more than five years ago.
Meta is working with Broadcom on the chip's design, while Taiwan Semiconductor Manufacturing Co. (TSMC) will manufacture it.
The custom silicon is intended to complement the large number of graphics processing units (GPUs) Meta purchases from Nvidia and Advanced Micro Devices (AMD) while helping the company lower computing costs and reduce dependence on external suppliers.
Meta plans to deploy seven gigawatts of computing infrastructure this year before doubling capacity to 14 gigawatts in 2027.
To support its AI expansion, the company has secured long-term supply agreements with Samsung Electronics for memory chips, Sandisk for flash storage and Sumitomo Electric for fiber-optic equipment.
Alongside its infrastructure investments, Meta introduced Muse Spark 1.1, describing it as the latest version of its AI model focused on coding and agentic AI capabilities.
The company is making the model available through a public developer preview, allowing developers to join a waitlist for API access through Meta's developer portal.
"This is going to be served on top of the computer infrastructure that we’ve built," said Meta's AI chief Alexandr Wang.
Wang said the updated model is Meta's "strongest model for agentic and coding work yet."
He also said the pricing is "very aggressive and attractive" compared with competing offerings from OpenAI and Anthropic. New API users will receive $20 in free credits before usage-based pricing begins.
"The goal is to really have attractive pricing that scales with immense consumption usage," Wang said.
According to Wang, Meta trained Muse Spark 1.1 to strengthen coding capabilities because "You kind of have to build coding capabilities as part of that in service of overall agentic capabilities."
Meta said it is currently limiting API access to its own ecosystem rather than making the model available through third-party AI marketplaces.
The latest announcements come as Meta continues to increase spending on AI infrastructure.
Reuters reported that the company expects to spend as much as $145 billion on AI infrastructure this year, accounting for a significant share of Big Tech's projected AI investment.
The company also announced plans to build its first Canadian data center in Sturgeon County, Alberta.
The AI-optimized facility represents an investment of more than CAD $13 billion, is expected to support about 3,000 construction jobs at peak and more than 300 operational positions, and will run on 100% clean and renewable energy.
Mark Zuckerberg’s Meta has filed a patent for a “creepy” AI-powered wearable device that would be capable of tracking the user’s emotional state – right down to their sighs and laughter and what time of day they take medication.
The patent filing, which was published on July 2, describes an “apparatus” for “emotional state analysis and real-time fitness coaching.” Meta wrote in part that the device would use insights such as whether the user is happy or sad to generate a workout routine.
“The AI assistant may listen to a user(s) at predefined times to hear various types of communication, such as sighs, laughter, and/or the tone(s) of a voice(s),” the filing says. “The AI assistant may use these inputs to quantify the user’s emotional state or generate other insights about the user.”
Meta’s patent filing was published on July 2. US PATENT OFFICE Meta’s filing adds that AI software tied to the wearable device could use the data it tracks to “provide a summary of emotional trends based on various inputs (e.g., a happier emotional state associated with a particular time of day or at a time when medication is taken, etc.).”
In one scenario described by the patent filing, Meta’s wearable would recognize when a “user laughs with friend at dinner at 5:15 pm,” and the audio of that moment would be “recognized and logged by AI.”
Meta asserts that an AI-powered fitness device would be more effective that a human personal trainer in crafting routines for users. It could be capable of providing real-time feedback on form during particular exercises and dictating workouts when the wearer is most emotionally “ready” for them.
“Like other companies, patents at Meta are often filed to disclose concepts that may or may not be implemented, and a granted patent does not guarantee that Meta has pursued or will pursue the technology described,” a Meta spokesperson said in a statement.
The patent was first reported by Patentlyze and 404 Media.
Meta said it may or may not pursue actually building the device. US PATENT OFFICE The filing drew immediate pushback from online safety advocates, including Fairplay executive director Josh Golin, whose organization has repeatedly blasted Meta for pursuing invasive technologies.
“This creepy patent appears to be part of Meta’s grand plans to monitor every aspect of our lives in order to profit off of ads targeted to users’ emotional vulnerabilities,” Fairplay executive director Josh Golin said in a statement.
Critics have long accused Mark Zuckerberg of prioritizing profits over user privacy. REUTERS “For impressionable young people, this is particularly worrisome and speaks to why privacy legislation that limits data collection and bans targeted ads to minors is so desperately needed,” Golin added.
Critics have long accused Zuckerberg of prioritizing profits over user privacy and safety. Those concerns have been amplified in recent months as Meta leans further into its “smart” glasses.
Meta has pushed heavily into “smart” devices. REUTERS The company came under fire last month when Wired reported that it had quietly embedded facial recognition software in its glasses with the capacity to identify specific people who cross paths with the wearer. Meta claimed the software hadn’t shipped to consumers and blasted the news outlet for what it called “advocacy-driven click bait.”
The smart glasses previously drew flak for enabling creeps to record themselves making unwanted passes at unsuspecting women.
Meta Platforms stock is trading near recent lows. What should traders watch with META? Breaking Ground in CanadaThe Sturgeon County data center will be powered by 100% clean and renewable energy, with Meta fully funding new generation and grid infrastructure to support its energy needs. The facility will use a water-efficient closed-loop, liquid-cooled system with dry cooling, meaning no operational water use in the cooling system.
The model pairs with Muse Spark to plan layouts, look up real-time web context, and intelligently blend multiple visual references. Users can also tag Instagram accounts to incorporate public photos into their creations. Muse Image is free for everyday use and is also available as part of Meta’s subscription plans. Muse Video is already in development.
Meta Shares DropMETA Price Action: At the time of publication, Meta shares are trading 3.55% lower at $581.70, according to data from Benzinga Pro.
Image via Shutterstock
This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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The semiconductor scene is going through an intense period of volatility again, but nothing much has changed when it comes to Wall Street analysts who stand by their targets. With the broader semiconductor names under pressure following the single-day plunge suffered by the South Korean memory giants, questions linger as to whether the AI chip bubble has finally begun to show signs of deflating.
JPMorgan (NYSE:JPM | JPM Price Prediction) thinks the latest retreat is worth buying, but not everyone is pounding the table after the latest drawdown. Another bank, Morgan Stanley (NYSE:MS), seems to think that a rotation is underway. But which camp is right remains the hot topic of discussion. Personally, I think there are many ways to play the latest drop in chip stocks without having to step into the blast radius with the memory and storage makers.
Even if the semiconductors stand to benefit from a multi-year structural tailwind, with secular forces still very much in play, a valuation reset (or correction) alongside a rotation might still be on the table. So, instead of subscribing to one bank’s buy-the-dip approach or another’s cautious rotation call, I think it makes sense to expect both scenarios to unfold.
Perhaps the second half of the year is a correction period for the semis while investors rotate their winnings elsewhere, all while the long-term trend stays intact as the AI revolution continues to set a stage for more off-the-charts quarters for the firms sitting comfortably, continuing to sell out of components needed to get the accelerate the AI data center buildout or, better yet, get things running a bit ahead of schedule.
Meta Platforms: A stealth chip winner as custom silicon takes off With Meta Platforms (NASDAQ:META) kicking off Meta Compute to sell extra capacity to other firms, Mark Zuckerberg and company might have the release valve to completely floor it with the buildout.
Perhaps it makes the most sense to build first and ask questions later about what the right level of AI compute is for a firm’s needs, given the bottlenecks that have popped up from left, right, and center.
From power demands to electrical components, it feels like procuring, building, and selling excess compute, if any, is the most logical move, as the hyperscalers scale up without showing any signs of looking back. While Meta isn’t a traditional chip play, I do think that its custom silicon efforts are being slept on by much of the market as shares sink further into bear market territory. Sure, many firms are getting into custom silicon, so it’s nothing that makes Meta unique.
Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Meta didn't make the cut. Grab the names FREE today.
But what sets the firm apart is its aggressive development cycle (six months rather than one to two years), architectural innovation to get around memory bottlenecks, and optimization for the Mixture-of-Experts (MoE) architecture, which may very well hold the key to next-generation AI that goes beyond large language models (LLMs). Perhaps it’s the MoE optimization that could ascend Meta’s silicon to the next level.
Meta Compute is still underestimated MTIA is custom-tailored for Meta’s own uses, but with Meta Compute, it might soon become a gold standard as Meta looks to disrupt the neoclouds with not only scale but efficiencies that customers can’t get elsewhere.
So, while some may see Meta as having too much extra compute, I’d be more inclined to view the firm as positioning itself in a way so that it can get really aggressive. More recently, the firm was reported to have plans to spend $13 billion on a massive one-gigawatt (1.0 GW) AI data center in Alberta, Canada. That’s a massive undertaking if true.
With a Street-high price target just north of $1,000 per share (that belongs to Rosenblatt Securities) and widespread hedge fund buying activity in recent quarters, Meta Platforms may very well be an underrated gem as it looks to dominate in all areas it touches, from AI chips (MTIA) to data centers, and models (Muse Spark and Superintelligence Labs).
Rotation or not, Meta already seems set for a big win as it executes on its seriously aggressive AI strategy.
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Meta Platforms Inc (NASDAQ:META) is sitting out the broader tech rally today, down 4.1% to trade at $578.19. An internal memo reviewed by Reuters indicated the company may spend up to $145 billion on AI infrastructure this year. The aim is to double computing capacity by 2027, and plans to begin manufacturing its 'Iris' chip in September.
META is now down 12.6% in 2026 and back below $600, with recent rallies turned away at a confluence of moving averages. Longer term, the shares are down nearly 21% in the last 12 months, carving a channel of lower highs.
Options bulls are steadfast. META's 10-day call/put volume ratio of 2.21 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks higher than 86% of readings from the past year.
Echoing this, the stock's Schaeffer's put/call open interest ratio (SOIR) of 0.51 sits in the 6th percentile of its annual range, which indicates a heavy preference for calls among short-term traders.
Three months after unveiling its first artificial intelligence model under the leadership of AI chief Alexandr Wang, Meta is rolling out a major update as it attempts to compete with OpenAI and Anthropic in critical areas of the market.
Muse Spark 1.1, which Meta introduced on Thursday, represents its "strongest model for agentic and coding work yet," Wang said in an interview with CNBC. The initial Muse Spark model released in April was only available to "select partners" who could access the technology via a "private API preview."
Meta is making the new model's API available through a developer portal as part of a public preview, where users will be able to sign up and see instructions for integration. A Meta spokesperson said some early partners can already access the API, and new users "will be able to add themselves to a waitlist and be added from there over time." For now, Meta said it's limiting API access to its own properties rather than making it available on third-party platforms like the popular OpenRouter marketplace.
"This is going to be served on top of the computer infrastructure that we've built," Wang said.
It's Meta's second notable rollout for the Muse family this week. On Tuesday, Meta released Muse Image, originally code-named Mango, a model for creating images, as the company seeks to attract creators and advertisers to its offerings.
Meta CEO Mark Zuckerberg is coming under pressure from Wall Street to show a return on the company's massive and growing investment in AI infrastructure and development. While it's spending at the rate of its hyperscaler peers, Meta doesn't have a cloud infrastructure business (though it plans to start one), and it's failed to keep up with OpenAI, Anthropic and Google in developing popular models and AI applications.
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Wang characterized pricing of the Muse Spark update as "very aggressive and attractive" compared with similar offerings from labs like Anthropic and OpenAI. He said every new API account will start with $20 in free credits. From there, the company will charge $1.25 per million tokens in input, and $4.25 per million tokens of output, he said.
"The goal is to really have attractive pricing that scales with immense consumption usage," Wang said.
He said Muse Spark 1.1 outperformed rival models in certain tasks involving the ability to interact with various third-party coding products and services.
Wang's Meta Superintelligence Labs, or MSL, trained Muse Spark 1.1 to excel in coding-related tasks because that ultimately improves the capabilities of AI agents that can autonomously perform multiple tasks like a fleet of human interns, he said.
"You kind of have to build coding capabilities as part of that in service of overall agentic capabilities," Wang said.
The tech industry's excitement about AI agents took off in the first half of 2026, in part due to the sudden popularity of OpenClaw, which developers could use to manage AI models that power supercharged digital assistants. Wang said Meta trained Muse Spark 1.1 "to be able to work well with all of the most popular harnesses that developers use today, and we felt that was the best approach for this model given our goal to maximize adoption."
Although Meta's previous AI strategy emphasized releasing its earlier Llama family of models to the open-source community, the company is now focusing on selling access to proprietary AI models.
Wang said that Meta is still "committed to open source" and that his MSL unit has a "variant of Muse Spark that is in development that we do intend to open source." He declined to say when the company would release it.
Wang added that he's been "dog-fooding" the latest Muse Spark model, and is excited about the technology's ability to be used as tool for improving personal health via tasks like searching the web, reading academic papers and accessing personal health-related data.
"It's one of these use cases that I think really encapsulates the needs of these agentic systems," Wang said of his AI and health experiments.
Wang said Meta is currently training a more powerful AI model, code-named Watermelon, but didn't say when it would be released. Muse Spark's code name was Avocado.
People walk behind a logo of Meta Platforms company, during a conference in Mumbai, India, September 20, 2023. REUTERS/Francis Mascarenhas Purchase Licensing Rights, opens new tab
July 9 (Reuters) - Meta Platforms (META.O), opens new tab on Thursday released long-awaited developer access to its Muse Spark AI model alongside an upgraded version, pitting it directly against the business models of Anthropic and OpenAI in charging for use of its AI.
The social media giant touted Muse Spark 1.1 as its most capable model for real-world coding and agentic tasks, part of a broader mission the company is pitching of delivering "personal superintelligence."
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Meta said the upgraded model can write and debug code, use software and external tools, understand text, images and video, and carry out complex multi-step tasks with less human intervention.
In April, Meta debuted Muse Spark, the first text and reasoning AI model from the superintelligence team it assembled last year to close the gap with rivals in the heated competition for AI supremacy.
Meta was testing the Application Programming Interface with partners in a private preview during its launch. The API is a key element for AI systems, acting like a digital bridge for developers that allows them to use the model's capabilities in their own software systems.
Developers in the United States can now access Muse Spark in public preview on Meta Model API, letting them test prompts, compare outputs and prototype integrations.
Those who sign up for the API receive $20 in free credits to test the model before switching to pay-as-you-go pricing.
The access is priced at $1.25 per million input tokens and $4.25 per million output tokens, above OpenAI's entry-level GPT‑5 mini and Anthropic's low-cost Claude Haiku 4.5, but below Anthropic's higher-end Claude Sonnet 4.6 model.
The new model is now available in Thinking mode in the Meta AI app and on the website. It is also expected to replace existing Llama models powering chatbots on WhatsApp, Instagram, Facebook and Meta's collection of smart glasses.
The release follows a company announcement on Tuesday expanding generative AI tools across its apps by rolling out Muse Image, its first image-generation model from Meta Superintelligence Labs.
Reporting by Harshita Mary Varghese in Bengaluru and Katie Paul in New York; Editing by Pooja Desai
Our Standards: The Thomson Reuters Trust Principles., opens new tab
Index Dow Jones -0,12 % na 52286,93 b., S&P 500 +0,32 % na 7506,42 b., Nasdaq Composite +0,53 % na 26008,92 b.
Technologické akcie dnes táhnou index S&P 500 nahoru, podpořeny silnou poptávkou po americkém IPO jihokorejského výrobce paměťových čipů SK Hynix. Nabídka je podle lidí obeznámených s danou záležitostí více než sedmkrát přepsána. Cena emise byla stanovena na 149 USD za jeden americký depozitní certifikát, přičemž akcie se mají začít obchodovat na burze v pátek.
Micron (+7,2 %) oznámil urychlení plánovaných investic do amerických výrobních závodů a technologií. Celkové výdaje by měly do roku 2035 přesáhnout 250 mld. USD, oproti původně plánovaným 200 mld. USD. Cílem je vyrábět 40 % veškeré paměti DRAM v USA, přičemž první výstup z výrobní linky v Idahu se očekává v polovině roku 2027.
Naopak akcie Paramount Skydance klesají 7,8 % poté, co analytická společnost Arete Research snížila své doporučení na „prodat" a stanovila nejnižší cílovou cenu na trhu. Důvodem je obava z vysokého zadlužení, které by společnosti přinesla případná fúze s Warner Bros. Discovery.
Akcie IBM a Microsoftu také oslabují poté, co Bloomberg News informoval, že Starbucks vyvíjí vlastní interní nástroje s pomocí umělé inteligence, které by mohly nahradit software nakupovaný od těchto společností. Řetězec káváren buduje alternativy k systému Microsoftu pro sledování zásob a nástroji IBM pro správu údržby. Část nového softwaru by mohla být nasazena do konce příštího roku, pokud projde testováním.
Výrobce nápojů a potravin PepsiCo (-4,8 %) zveřejnil výsledky hospodaření za druhé čtvrtletí roku fiskálního roku 2026. Organické tržby vzrostly o 2,4 %, čímž mírně zaostaly za odhadem analytiků, přičemž segment potravin v Severní Americe organicky klesl o 2 %. Tržby a jádrový zisk na akcii odhady mírně překonaly a společnost potvrdila celoroční výhled organického růstu tržeb.
Společnost Meta Platforms (-2,7 %) plánuje od září zahájit výrobu vlastního AI čipu, a to jako součást plánu na navýšení celkové výpočetní kapacity na 14 gigawattů v příštím roce. Vyplývá to z interního mema, které měla agentura Reuters k dispozici.
Index S&P 500 +0,32 % na 7506,42 b. Nejsilnější sektory S&P Změna Nejslabší sektory S&P Změna Informační technologie +1,5 % Nezbytná spotřeba -1,8 % Průmysl +0,9 % Komunikační služby -1,5 % Utility +0,2 % Zbytná spotřeba -0,7 % Nejsilnější akcie S&P Změna Nejslabší akcie S&P Změna Lam Research Corp (LRCX) +11 % Paramount Skydance Corp (PSKY) -7,8 % Lumentum Holdings (LITE) +10,0 % PepsiCo (PEP) -4,8 % Applied Materials (AMAT) +9,6 % FactSet Research Systems (FDS) -4,4 % KLA Corp (KLAC) +9,4 % Palantir Technologies (PLTR) -4,0 % Ciena Corp (CIEN) +8,6 % Gartner (IT) -3,8 % Zdroj: Bloomberg
A worker stands inside the Meta Lab in Los Angeles, California, U.S., May 20, 2026. REUTERS/Daniel Cole Purchase Licensing Rights, opens new tab
SummaryCompaniesMeta to deploy 14 gigawatts of computing next year, memo showsFirm to manufacture 'Iris' AI chip from September, memo showsMeta has deals for memory, flash storage, fiber-optics, memo showsNEW YORK/SAN FRANCISCO, July 9 (Reuters) - Meta Platforms (META.O), opens new tab plans to start manufacturing an artificial intelligence chip from September as part of its plan to boost overall computing power to 14 gigawatts next year, showed an internal memo reviewed by Reuters.
The tech firm's data center chip, code-named "Iris", is part of a four-generation project for Meta Training and Inference Accelerators (MTIA) that it will design in-house. The plan is to use custom-built silicon to improve the AI that powers its Facebook and Instagram social media platforms.
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Testing the chip took only six weeks and found no major issues, the memo showed. That relatively quick progress signals positive momentum for an in-house effort that has floundered since its launch more than half a decade ago.
Meta tailored the chip for its own needs and is working with Broadcom (AVGO.O), opens new tab to help design it and Taiwan Semiconductor Manufacturing Co (2330.TW), opens new tab to manufacture it. The approach is likely to help the firm lower its massive computing costs and gain more independence from chip suppliers such as Nvidia (NVDA.O), opens new tab and Advanced Micro Devices (AMD.O), opens new tab.
The bug-testing completion and production timing have not been previously reported. Meta declined to comment.
The chip is aimed at augmenting the large quantities of graphics processing units (GPUs) used for AI applications that Meta purchases from Nvidia and AMD.
However, adopting the latest GPUs at a firm as large as Meta "has been a heavy lift, and it has cost us time," the memo showed.
Meta unveiled Iris under its technical name in March along with three other AI processors. It plans to launch a chip about every six months through 2027, whereas typically firms release AI chips at intervals of a year or more.
SEVEN GIGAWATTS OF COMPUTING IN 2026Meta this year plans to deploy seven gigawatts of computing infrastructure, the memo showed. It plans to double that number in 2027, the memo said.
The firm expects to spend as much as $145 billion on AI infrastructure this year, a significant portion of Big Tech's more than $700 billion projected outlay on the technology.
To expand computing infrastructure, Meta has secured long-term, multi-year supply agreements, the memo showed. Those include agreements with Samsung Electronics (005930.KS), opens new tab for memory chips, Sandisk (SNDK.O), opens new tab for flash storage and Sumitomo Electric (5802.T), opens new tab for fiber-optic equipment.
Sandisk declined to comment. Samsung Electronics and Sumitomo Electric did not respond to requests for comment.
Components such as memory and AI chips have experienced a surge in demand as tech companies race to expand data centers to keep pace with AI's thirst for computing power.
Memory and other chip prices have risen rapidly and substantially enough that "chipflation" has become a macroeconomic concern, Morgan Stanley analysts said.
Reporting by Katie Paul in New York, and Max A. Cherney and Stephen Nellis in San Francisco; Editing by Christopher Cushing
Our Standards: The Thomson Reuters Trust Principles., opens new tab
Max A. Cherney is a correspondent for Reuters based in San Francisco, where he reports on the semiconductor industry and artificial intelligence. He joined Reuters in 2023 and has previously worked for Barron’s magazine and its sister publication, MarketWatch. Cherney graduated from Trent University with a degree in history.
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
Artificial intelligence spending has entered a new phase. The industry’s biggest technology companies are no longer debating whether to build more infrastructure — they’re competing to build it faster than everyone else. Meta Platforms (NASDAQ:META | META Price Prediction) is among the most aggressive, with capital expenditures expected to reach between $125 billion and $145 billion this year, according to the company’s latest guidance.
Last week, reports suggested Meta was preparing a new business selling excess AI computing capacity. This week, it announced a new $10 billion Canadian data center. At first glance, those headlines seem to point in opposite directions, but they just might reveal the same long-term strategy.
New Data Center Doesn’t Contradict Compute Strategy Reports last week indicated Meta wants to create a new revenue stream by renting unused GPU capacity to outside customers, much like cloud providers already do. The idea is simple: if Meta has computing resources sitting idle between AI training cycles, why not monetize them instead of letting expensive hardware go unused?
Then came the announcement of a 1-gigawatt, roughly $10 billion data center in Alberta, Canada — its first major facility in the country. The timing prompted some understandable skepticism. If Meta expects to have excess compute available to rent, why is it adding another massive data center?
Surprisingly, that’s exactly the point. Hyperscale data centers take years to construct, while AI demand rises in bursts rather than a straight line. Meta isn’t building for today’s workloads. It’s building for where it believes AI demand will be in 2028 and beyond. Any temporary excess capacity becomes inventory that can generate revenue instead of remaining an idle cost.
Rather than undermining the cloud strategy, the Canadian facility expands the amount of compute Meta can potentially monetize.
Meta also carries baggage. Investors still remember the tens of billions spent — and lost — on Reality Labs and the metaverse with little financial payoff. Adding another $10 billion project naturally invites comparisons, even though AI has far clearer commercial applications than virtual reality ever did.
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Environmental concerns add another layer. Alberta officials have emphasized projects capable of securing their own power supplies, but critics note large AI data centers consume enormous amounts of electricity, with this project expected to rely heavily on natural gas generation.
The Bigger Bet Is Utilization Meta isn’t expecting every GPU to remain busy with its own applications every hour of every day. That’s inefficient. Instead, management appears to be treating compute much like airlines treat empty seats or hotels treat vacant rooms. Internal AI projects receive priority. Excess capacity becomes a product.
Granted, skeptics argue every hyperscaler now seems to be planning the same thing — build more infrastructure than needed and rent the surplus to someone else. If every company follows that strategy, pricing pressure could emerge.
That said, Meta has one advantage many rivals lack. Its advertising business continues generating tens of billions in quarterly operating cash flow, giving it sufficient financial flexibility to absorb years of infrastructure investment while new revenue streams mature.
Key Takeaway In short, Meta’s Canadian data center doesn’t undermine its plan to sell excess compute — it strengthens it. The company isn’t building because it already has too much capacity. It’s building enough infrastructure to satisfy its own AI ambitions while creating a cloud-like business capable of generating additional revenue from any unused compute.
Ultimately, the real question isn’t whether Meta is building too much. It’s whether utilization rates remain high enough to justify the investment. If management succeeds in keeping both internal AI projects and outside customers filling those servers, today’s $10 billion spending announcement could eventually look less like overbuilding and more like laying the foundation for an entirely new business. For long-term investors, that’s the metric worth watching — not simply the size of the construction bill.
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Facebook and Instagram parent Meta said Wednesday it will invest more than US$9.1 billion to build its first artificial intelligence data center in Canada and its largest outside the United States.
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Meta CTO Andrew Bosworth shared new details about a data leak from its AI training program. Bloomberg/Getty Images Meta CTO Andrew Bosworth shed new light on the data leak that made the company pause its unpopular Model Capability Initiative.
In an interview with The Atlantic CEO Nicholas Thompson, released on Wednesday, Bosworth spoke about why Meta paused the AI training program that involved tracking employee keystrokes. The interview was filmed in late June.
Bosworth said that data generated by the training program was "quite secure," with only a small number of people having access, but it had been erroneously moved by one of Meta's researchers.
"One of the researchers who was working downstream with that data—and there was no breach here— but had put it in a place it wasn't supposed to go," the executive told Thompson.
The employee data, in a transformed state, had "landed someplace that it shouldn't have landed internally," he said, adding that Meta did not suspect foul play.
The company was "locking the whole thing down" until it could get to the bottom of this incident, Bosworth said.
The Model Capability Initiative was introduced in April. It involved installing software on the majority of Meta's US employees to track their keystrokes and mouse movements to train its AI models. The program — and Meta's instruction that employees couldn't opt out of it — drew major backlash from its workforce.
Bosworth himself said, during an internal meeting, that employee morale in the company was "probably one of the worst it's ever been" in Meta's two-decade history.
However, the program was paused in June after a leak made sensitive employee data accessible to the entire company, according to screenshots seen by Business Insider.
"We have carefully designed this program with privacy safeguards, and while we have no indication at this time that any data was improperly accessed by Meta employees, we're pausing it while we investigate," a Meta spokesperson told Business Insider in June.
In the interview, Bosworth also shared another reason the program had not gone to plan. It was generating a lot of the same data, he said, when ideally, the company should have gotten more varied data that could be used to train its AI.
"Variance is far more important than a high volume of the same thing that gets collapsed into one example, basically," he said to Thompson.
"So that was why, a couple of weeks after we initially launched it, we added expanded opt-outs for people who didn't want to do it," he said. "A pause, infinite pause. Whenever you don't want to have it, just press pause."
Representatives for Meta declined to provide further comment in response to a query from Business Insider.
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Meta (META 2.02%) CEO Mark Zuckerberg held a town-hall meeting with his staff. And if the leaks from that meeting are true, he basically said that his company needs more time to make its artificial intelligence (AI) investments work. Investors were not pleased, sending the stock sharply lower on the news. This could be a big deal.
What is Zuckerberg's admission telling investors? In a similar fashion to the internet-driven dot-com bubble, investors have been rewarding just about any mention of artificial intelligence. Just like during the dot-com bubble, when companies happily appended ".com" to their names, you have companies leaning into the AI theme. OpenAI, though not public (yet), is perhaps the prime example. But every company that invests in AI won't end up a winner.
Image source: Getty Images.
Meta's CEO basically just admitted that making AI work isn't as easy as you might hope. Despite that, the company is making drastic, rapid changes, including large staff reductions. Meta's top brass appears worried that it won't change quickly enough to keep up with the competition. That's not unreasonable, given that AI is a new and transformative technology.
The only problem is that it is new and transformative, and nobody has yet figured out what a sustainable business model looks like. There are billions of dollars going into AI, but all that is backing the spending up are predictions of what AI might be capable of. Notably, Meta just sold $25 billon in debt, which follows on a $30 billion debt sale in late 2025.
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AI spending was the primary driver of the debt sales, suggesting the company is leaning hard into something that isn't working out as planned. It probably shouldn't be surprising that the pricing around the 2026 debt sale indicated that investors were more tentative than during the 2025 debt sale, according to Bloomberg. Meta's stock decline following the leak from the Zuckerberg town hall is basically illustrating the same concern, just in the stock market.
Not time to panic, but start watching more closely It is too soon to suggest that Meta's investment in AI is a failure. In fact, given the company's size and importance in the tech sector, it will likely find a way to make AI work. However, that doesn't mean all of the AI spending it is doing will be financially rewarding. Investors are already starting to worry that money is being wasted on the AI effort, suggesting that you should probably pay increasing attention to Meta's AI progress. But don't stop at Meta. You should probably be paying extra attention to any AI spending that's taking place at the companies you own.
Canada's getting its first Meta data center, and it's built for AI By You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.
Meta's data center facility in Alberta, Canada, is expected to bring 300 operational jobs, the company said. Meta Meta is bringing a data center to Canada.
The company announced on Wednesday that it broke ground for a new AI computing center in Sturgeon County, Alberta, just outside Edmonton. The facility represents an investment of more than CAD $13 billion, or roughly $9 billion, and is planned as a 1-gigawatt data center, the company said in a press release.
It will be Meta's first data center in the country.
"This data center will be optimized for our AI workloads, helping bring to life the technologies that billions around the world use to connect, find communities, grow businesses, and experience the power of our wearables," Meta said.
The facility will be Meta's 33rd data center globally. Meta said it expects the project to support more than 3,000 construction workers at peak and more than 300 "operational jobs" once it's completed. The company said it will also spend about CAD $60 million, or about $42 million, on local infrastructure improvements.
Meta did not disclose the acreage or square footage of the Sturgeon County campus. The company said the facility will use a "closed-loop, liquid-cooled system with dry cooling," meaning it is designed to avoid the need for a continuous water supply for cooling.
A Meta spokesperson did not immediately respond to a request for comment.
In a statement, Alanna Hnatiw, the mayor of Sturgeon County, welcomed the new facility as a positive development for the region, bringing jobs and "long-term tax revenue."
"We're excited to work with our new neighbours as we continue to make that vision a reality," the mayor said.
In the US, Meta said it has 28 data centers, including the massive Richland Parish site in Louisiana.
The Louisiana data center campus is expected to be Meta's largest facility to date, with a footprint of 4 million square feet, providing more than 2 gigawatts of compute capacity.
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Lloyd Lee You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.
Meta Platforms (META 1.91%) has not performed well this year. With the company spending small fortunes on its artificial intelligence (AI)-related ambitions, many investors are worried that its investments won't lead to significantly stronger financial results and will only squeeze its profits and margins. However, some recent developments suggest that Meta Platforms' AI spending might pay off after all, just not in the way some people imagined. Let's look into a potential new business venture the tech leader is exploring and what investors should make of it.
Image source: The Motley Fool.
An attractive new growth driver? According to reports, Meta Platforms is exploring selling excess computing capacity. It could do so in several ways, including renting out GPU (Graphics Processing Unit) capacity it isn't using, or the Facebook parent company might also grant access to its internally developed large language models through the cloud. This new initiative could put Meta Platforms in direct competition with companies like Amazon, Microsoft, and Alphabet that currently dominate the cloud computing industry. And if it can successfully establish itself in this field, Meta Platforms would likely become an even stronger company. Here are two reasons why.
First, the tech giant currently generates almost all of its revenue from its advertising business. Although this is a strong, high-margin operation, launching a new and successful cloud segment would help the company diversify its revenue base. Second, AI infrastructure spending should continue growing at a good clip over the next few years (at least). That means increasing demand for, among other things, precisely the sort of services Meta Platforms is considering offering through this new business venture. That's probably why the company is exploring doing so in the first place: there is a large opportunity here. And even if it has to battle it out against other major hyperscalers, there might just be more than enough room in this market for Meta Platforms to carve out a niche.
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Although Meta Platforms gaining a foothold in this market would likely be great for the company, we aren't there yet. In the meantime, despite its poor stock performance, the tech leader has posted strong financial results this year. In the first quarter, Meta Platforms' revenue increased 33% year over year to $56.3 billion, while its earnings per share rose 62% to $10.44. Meta Platforms has already benefited from AI, as the company has used the technology to meaningfully grow engagement across its family of websites and apps, while also helping companies get more bang for each advertising buck.
My view is that Meta Platforms' AI-related spending is already justified, and even if, by some chance, it fails to have a bigger impact on the business, Meta Platforms can regroup and reduce expenses, just as it did when its metaverse ambitions failed to materialize. Meanwhile, the company still boasts more than 3 billion daily active users, is slowly ramping up new opportunities like paid messaging on WhatsApp, and could conjure up even more in the future. Meta Platforms' deep ecosystem and innovative capabilities remain among its biggest advantages. And the company also benefits from a moat thanks to network effects. These are all great reasons why, despite its poor stock performance this year, Meta Platforms' shares are worth investing in.
Prosper Junior Bakiny has positions in Alphabet, Amazon, and Meta Platforms. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, and Microsoft. The Motley Fool has a disclosure policy.
The "Magnificent Seven" plan to spend more than $700 billion on artificial intelligence capital expenditures this year, a big step up from the $400 billion or so the group spent in 2025.
In 2025, whenever hyperscalers announced plans to increase their AI-related capex, their stocks surged. But now, that spending has become a major point of contention in the market, primarily because investors are worried that the returns on these massive investments may not live up to the hype.
In particular, investors are worried that hyperscalers may overbuild AI infrastructure. Meta Platforms (META 1.91%) CEO Mark Zuckerberg may have just given us a big hint about how valid those concerns might be.
Image source: Getty Images.
Meta's new cloud infrastructure plan could be a tell Recently, Meta announced it is launching a new cloud business that will lease its excess compute capacity to external customers. Shares popped on the news, as it could lead to immediate revenue from the company's new data center builds, which investors are already clamoring to see, given the size of Meta's capex.
Meta has guided for capital expenditures of $125 billion to $145 billion this year, most of which will cover "additional data center costs to support future-year capacity."
The announcement is big news in the AI narrative because back in the third quarter of 2025, Zuckerberg implied that his company wouldn't become a supplier of compute unless it overbuilt AI infrastructure:
Now, I mean, it's of course possible to overshoot that, right? And if we do, I mean, this is what I mentioned in my comments, then we see that there's just a lot of demand for other new things that we build internally, externally. Like, almost every week, people come to us from outside the company asking us to stand up an API service or asking if we have different compute that they could get from us. And we haven't done that yet, but obviously, if you got to a point where you overbuilt, you could have that as an option.
Now, it's not a total surprise, as Zuckerberg has been hinting that Meta might begin leasing compute, and the stock has struggled this year. Even after the rally on the cloud announcement, the stock was still down about 9.5% year to date as of July 6.
Does this signal a massive overbuild? As with everything else in AI, it's hard to provide a definitive answer on whether we are at the beginning of a massive overbuild in AI infrastructure. After all, consider that Space Exploration Technologies recently raised nearly $86 billion in its massive IPO, partly on the thesis that it will deploy an enormous constellation of data center satellites in orbit.
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Zuckerberg also does not necessarily view the current situation as an outright infrastructure overbuild; rather, it is that the company has gotten ahead of schedule in building what it will require. On the company's third-quarter 2025 earnings call, he also said that the worst-case scenario is that Meta has built some of its AI data center capacity a few years in advance. In this scenario, while those assets would experience some loss and depreciation, the company will eventually utilize the compute.
Additionally, rental prices for most graphics processing units (GPUs), even older models, appear to be on the rise, suggesting that demand for compute remains strong.
All that said, investors should continue to weigh the evidence carefully on both sides of the debate, and understand that the narrative could break in either direction. Furthermore, the hyperscalers have not yet spent the full $700 billion that they've allocated to capital expenditures this year. They could easily revise their AI capex guidelines should conditions require it.
If there is a pullback in spending, while investors in individual "Magnificent Seven" stocks may feel relieved, the market could view it as a major red flag for the entire AI trade.
Perhaps this scenario has been somewhat priced into these stocks, given the group's struggles thus far this year, but it's a risk investors need to be cognizant of, and Zuckerberg may have given the market a glimpse of what's to come.
Meta Platforms (META 1.91%) hasn't had the best performance thus far in 2026, as the stock has fallen nearly 7% as of this writing. But a recent announcement from CEO Mark Zuckerberg's company could reignite investor enthusiasm for some.
On July 1, Bloomberg reported Meta was planning to sell access to artificial intelligence (AI) computing power and models. That was enough to send Meta's stock price up 8.6% the following trading day. For cloud computing provider CoreWeave (CRWV +7.76%), however, the story was different.
Image source: Getty Images.
Good news for Meta shareholders By 2030, Goldman Sachs Research forecasts that cloud computing revenue could reach $2 trillion. For Meta, renting out excess computing capacity can be not only a revenue generator but also help offset some of the company's aggressive spending. It plans to spend up to $145 billion in 2026 to build out AI infrastructure.
According to the Bloomberg report, Meta is planning to either sell pure computing capacity or sell access to AI models. Access to the AI models would reportedly follow a similar structure to how Amazon runs its Amazon Web Services Bedrock platform, with Meta running its own data centers and semiconductors that power AI models developers pay to access.
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Not-so-good news for CoreWeave shareholders The CoreWeave stock price reacted differently to the Meta news. If Meta ends up selling raw computing capacity, it's not just entering another company's turf, since Meta is also a CoreWeave client, with a $21 billion deal for AI cloud capacity that runs through 2032. That raises the possibility that CoreWeave will eventually lose a client while gaining a competitor.
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When Meta announced its news on July 1, CoreWeave shares fell roughly 14% the following trading day.
Meta is reportedly still in the planning stage of setting up cloud infrastructure, so nothing is finalized. But if Zuckerberg's company were to move forward with renting out excess computing capacity, it would likely put even more pressure on the CoreWeave stock price.
Jack Delaney has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, Goldman Sachs Group, and Meta Platforms. The Motley Fool has a disclosure policy.
Facebook users keep accidentally posting onto Threads — and Threads users love it.
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Senior Correspondent covering technology and culture
Mark Zuckerberg's Meta started Threads three years ago. It now says it's up to 500 million monthly active users. I wonder how many people actually know they're posting there. Basak Gurbuz Derman/Getty Images If there is one standout Threads meme, it's: "This is Richard's wife. He has passed."
It's not a joke from some clever user; it was a real, grieving widow who apparently logged onto her husband's account back in December to announce that he'd died. Somehow, the post got picked up by the Threads algorithm, which showed it to thousands of strangers.
As of Wednesday, it had 18,000 likes and 1,800 comments.
(I reached out to Richard's wife, but didn't hear back. I wish her the best.)
Cross-posts from Instagram and Facebook are all over ThreadsThreads — Meta's answer to X — just celebrated its third anniversary. It's slowly but surely built up a large user base. Meta says it has more than 500 million monthly active users — more than X. That count is certainly helped by Threads' cross-promotion on Instagram and Facebook. Threads posts often appear in the Instagram app, encouraging people to click into them and download or open the separate Threads app. (Meta has said the percentage of daily active users who open the app directly instead of tapping into it from Instagram has grown over time, although they declined to share numbers.)
Aggressively cross-promoting from Instagram and Facebook is a great user-acquisition technique. But there's another side of the coin that has created a strange culture on Threads: the feeling that half the people posting there don't even know what app they're on.
The option to cross-post from Facebook or Instagram is not turned on by default, and on Instagram, the option is buried a little deep in the settings. However, on Facebook, when you create a new post in the mobile app, the option to cross-post to Threads is a simple "On" tap of the Threads @ logo right at the bottom of the post. Once you tap it "On," it stays on for subsequent posts. (You can always turn it off.)
Jocelyn Ramsey, a spokesperson for Meta, told Business Insider that it has recently added more friction to stop people from accidentally cross-posting.
When posting to Facebook, you can turn Threads cross-posting "On" with a single tap. screenshot It's unclear how much Threads content is cross-posted; Meta doesn't say. In my experience, the vast majority of posts I see on Threads are from engaged users who know where they are and are generally enjoying themselves.
But if I scroll a little, I almost always see at least a few posts that seem to be from someone who doesn't realize they're cross-posting to Threads. There are little tells like mentioning family members by name.
Because Threads' algorithm is so personalized, it's possible I see these unintended cross-posts more than other people. (I do tend to lurk around on there a lot.) But I can tell from engagement numbers that sometimes these clueless cross-posts go viral — it's not just me seeing them.
Accidental posts have become part of the fabric of Threads culture.
This post that came up in my Threads feed seems to be from a man who thinks he's direct messaging someone else; instead, it got picked up by the Threads algorithm and shown to me. Threads screengrab The 'gas leak' social networkLess than a year after it launched, Max Read called Threads the "gas-leak social network" because, as he wrote, "Everyone on the platform, including you, seems to be suffering some kind of minor brain damage." At the time, the issue wasn't Instagram or Facebook cross-posting (which wasn't yet enabled); it was that the kinds of people who gravitated to Threads often weren't hardened capital-P Posters, those used to the fast pace and edge of old Twitter and X.
The people posting on Threads seemed like innocent babes, incapable of identifying sarcasm or shitposts. (I found it incredibly easy to ragebait on Threads.)
But now it's not so much the gas leak — it's the platform leak. It's the people — typically older people who are less used to social media — who flipped on the toggle to crosspost and never check the Threads app.
We take for granted that text-mased social networks have all sorts of unspoken rules: Don't post your address. Don't post your phone number. Don't post photos of your grandkids or of kids not fully clothed. That celebrity asking you for a gift card is probably not really the celebrity.
This isn't really a problem on something like Bluesky or even on X, which typically has more experienced users. But Threads has so many Facebook and Instagram users — people with less experience navigating the choppy waters of algorithmic text-based social platforms. This creates a situation where there are Haves who understand social platform dynamics and Have-nots who don't.
And one of the dominant forms of entertainment on Threads is to chuckle at the Have-nots.
As someone who understands how Threads works, I admit I've enjoyed the people-watching aspect of seeing the platform leak. But I have to imagine this is a terrible experience for the people caught in the crosshairs.
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Katie Notopoulos You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.
Katie Notopoulos is a senior correspondent at Business Insider who writes about technology, business, and culture. She covers topics such as internet culture, Big Tech, retail, AI, parenting in the digital age, and personal tech.Previously, Katie was a tech reporter at BuzzFeed News and has written for The Atlantic, The New York Times, Fast Company, and MIT Technology Review. Based in New York, you can reach her by email [email protected] or find her on Twitter. Bluesky, and Threads @katienotopoulos.Some of her stories include:
Google AI said to put glue in pizza — so I made a pizza with glue and ate itThe Zuckermoon is overGen Z doesn't want to say "hello" when answering the phone. I'm concerned. Wait, is Walmart cool now?Mark Zuckerberg has created the saddest place on the internet with Meta AI's public feedHow Instagram got its mojo backAm I the JD Vance of my group chat?We need to talk about whatever's happening with Starbucks' drinksThis chart shows a key reason why millennial parents are miserableIt's not just you. Eggshells really are chipping more. Meta Instagram Facebook More Social Media
The logo of Meta at the Meta Lab in Los Angeles, California, U.S., May 20, 2026. REUTERS/Daniel Cole/File Photo Purchase Licensing Rights, opens new tab
SummaryCompaniesAlberta pitched cheap gas and cooler temperatures as key advantages1 gigawatt facility is Meta's 33rd globallyData center will be built in Sturgeon County in central AlbertaCALGARY, July 8 (Reuters) - Tech giant Meta announced Wednesday it will build a massive data center in central Alberta, the company's first in Canada, as it rapidly builds out computing capacity to support the global AI boom.
The 1-gigawatt data center will be located in Sturgeon County and represents a total investment of C$13 billion, or $9.17 billion, Meta said.
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Meta has doubled down on AI, pledging hundreds of billions of dollars to build large AI data centers in the U.S. The Alberta announcement represents the company's 33rd data center globally.
Executives made the announcement in Calgary alongside Premier Danielle Smith and other Alberta government officials, who have spent several years courting Silicon Valley tech giants with the aim of spurring a large-scale investment in the oil-and-gas province.
Meta, like other tech giants, is facing rapidly expanding power needs due to the growth of AI, and Alberta is rich in natural gas which sells at a significant discount to the U.S. benchmark.
The province's cold climate also makes cooling the massive super-computers and related data center infrastructure more cost-efficient.
The 20 existing small- to mid-scale data centers in Alberta already pull from the province's energy grid, which is 60% powered by natural gas. The provincial government is giving new proponents the option to build their own power sources to avoid limits on power capacity.
Meta said Wednesday it will fully fund new generation and grid infrastructure for its Alberta data center, which will consume about as much electricity as 800,000 homes.
The company has partnered with Alberta-based Pembina Pipeline, which announced last week it will go ahead with its Greenlight Electricity Centre, a new natural gas-fired power-generation facility in Sturgeon County which will be in service in late 2030 and with which Meta has a long-term tolling agreement.
The project will require approximately 150 million cubic feet per day of natural gas, according to Pembina, helping to create demand for Western Canadian natural gas producers.
Canada's government laid out an AI strategy last month that suggested new data center growth would benefit from the country's clean electricity grid, which is largely powered by renewables and low-emission power sources.
But the vast majority of data centers currently in the planning stages in Canada are located in Alberta, where a reliance on natural gas means the emissions intensity of the province's electricity grid is almost five times the national average.
Reporting by Amanda Stephenson in Calgary Editing by Nick Zieminski
Our Standards: The Thomson Reuters Trust Principles., opens new tab
Meta's AI expansion is heading north of the border.
The company said in a blog post on Wednesday that it's building its first data center in Canada, a 1 gigawatt facility in the province of Alberta that will cost Meta about $9 billion and take two to three years to construct. It's Meta's 33rd data center overall and the latest in the company's effort to rapidly build out to meet demand for artificial intelligence infrastructure and services.
Alberta, on the western side of Canada, represents an attractive spot for development due the province's hefty amount of available energy and friendly regulatory environment. The location for the site, in Sturgeon County, has long been zoned for industrial use and is in an area with the capacity for additional energy infrastructure.
"This specific location met the factors we typically look for: good access to infrastructure, a robust electric grid and access to energy, a strong pool of talent, and a great set of community partners that helped us move this project forward," a Meta spokesperson said in a statement.
While Meta continues its aggressive AI buildout, the company is simultaneously planning a new cloud computing business that could involve selling excess capacity to third parties or offering access to AI models hosted within its infrastructure. Investors have been skeptical of Meta's forecast for up to $145 billion on capital expenditures this year as the company has fallen far behind AI model leaders OpenAI, Anthropic and Google, and hasn't shown a clear path to revenue outside of online ads.
Meta's stock is down about 9% this year while the Nasdaq is up 11%.
Meta is racing to stand up AI facilities as it competes with hyperscalers Alphabet, Microsoft and Amazon, which all have flourishing cloud infrastructure businesses.
There are also concerns for local communities. A report in June from the Canadian Broadcasting Corp. highlighted environmental issues like emissions, water consumption and noise from big data centers.
Meta said it worked with various energy firms in Canada, including Greenlight Limited Partnership, Altalink, Capitol Power and the Alberta Electric System Operator, "to plan for and meet our energy needs years in advance of this data center coming online."
The company said the project will support over 3,000 construction workers at its peak, and will involve investments in local infrastructure and funding to local nonprofits.
WATCH: AI investing structure is creating a humongous bubble.
How to stop people from using your Instagram posts with Meta's AI By You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.
Instagram profiles now automatically allow users to share and modify other people's public posts, including their profile picture, with Meta's new AI model, Muse Image. Beata Zawrzel/NurPhoto via Getty Images If your Instagram account is public, your photos — including your profile picture — may now be fair game for other people's AI creations unless you change a setting buried in the app.
Meta's new Muse Image model, unveiled Tuesday, lets users generate AI images using public Instagram posts by tagging another person's account in a prompt.
Public accounts are opted in by default, allowing others to reuse posts, reels, and profile photos unless users manually switch the feature off.
The controls are only available in the Instagram app, under the "Sharing and reuse" tab in the settings menu, where users can disable separate toggles for posts and reels.
Meta's privacy settings default to allowing others to reuse your Instagram content and modify it with AI. Katherine Tangalakis-Lippert Existing AI-generated images made with your content won't be removed, and Instagram says on its help page about the feature that users won't be notified if their content is used by others.
The feature is part of Meta's broader push to compete in generative AI, as the company rolls out Muse Image to compete with rival image-generation tools from OpenAI, Google, Midjourney, and Adobe by making AI image creation a built-in feature for Instagram's billions of users.
The rollout is the latest flash point in Meta's long-running privacy battles. The company has faced years of scrutiny over its corporate and user-facing data practices, including criticism for using public posts to train AI models by default and requiring users to opt out rather than opt in.
Privacy advocates have long argued that such policies leave users with too little control over how their content is repurposed.
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Katherine Tangalakis-Lippert is a senior reporter on Business Insider's West Coast team. When she's not writing about trending business and tech news, from the latest supply chain snarls or advancements in AI, she covers the food and restaurant industries, specifically companies such as Starbucks and McDonald's.Some of her prior areas of focus have included coverage of the Supreme Court and emerging technologies such as quantum computing.Katherine has worked on award-nominated projects and has appeared on Good Morning America, NBC, CNN, and other outlets to discuss her reporting.Prior to joining Business Insider, she covered retail, hospitality, and nonprofits at the San Fernando Valley Business Journal and received a master's degree in investigative reporting from the University of Southern California.Reach outDo you have feedback or a story tip? Contact Katherine on Signal at byktl.50, or email her at [email protected] her on Twitter and Instagram @scrawlgirl.Some of her recent scoops, exclusives, and original stories include: Starbucks set up a new office. It's a 5-minute drive from the CEO's California home.Inside Starbucks' crackdown on cup notesEndless Shrimp was Red Lobster's rock bottom. Now it's clawing back.Chipotle's new PAC signals a change in how the company engages in politicsKFC lost its footing in the Chicken Wars. Now it's gunning for a 'Kentucky Fried Comeback.'A few other highlights include: Clarence Thomas raised him 'as a son.' Now he's facing 25-plus years on weapons and drug charges.Call her Ivanka Kushner'Maybe I'll just resign:' Federal workers react to DOGE productivity emailSpaceX launches cause late-night booms that rattle windows, set off car alarms, and may damage property. Locals are pushing back.The US-China tech race is moving from chips to the raw materials they're made of
Virtuix Holdings (NASDAQ: VTIX) leverages its 'Made for Meta' partnership to access 6 million Meta Quest users, aiming for rapid market penetration. VTIX trades at a 60%+ discount to IPO, offering a speculative entry point as the Meta launch could drive exponential growth and recurring revenue streams. Gross margin inflected from -6% to 25% on $4.3M revenue; new China facility supports $100M annual capacity, with a target 40% gross margin.
Meta’s AI glasses have a growing reputation as a creepy technology. The company hopes to change that opinion by announcing an update that will disable the camera if the LED light that indicates the glasses are recording has been tampered with.
The move is seemingly a concession to consumer sentiment that the glasses aren’t just fun, fashionable accessories, happily promoted by Kylie Jenner, but have serious implications for consumer privacy: They can be abused as surveillance devices.
Yet, even as Meta touts the new safeguard this week, the company is also pushing products and features that ask users to surrender more of their privacy to the company.
Whether that’s training its AI on your images, enabling AI features using your personal content unless you opt out, or exploring ways to continuously record or use biometric facial recognition, Meta’s vision of the future seems to always depend on collecting more of your personal data.
In its blog post about the new camera safety feature, the company pats itself on the back, noting that “no other kind of camera has done this and we’re proud to lead the industry effort.” However, Meta also admits that the move was necessary because some people had been using tape to cover the LED light, which had already forced Meta to adapt its tech to disable recording when the LED is blocked.
Determined, those same AI glasses creeps would then use “sophisticated efforts to modify or destroy the capture LED,” Meta’s announcement explains.
In other words, Meta is confirming that some people who use AI glasses have hidden agendas — namely a desire to record situations or people (often women) without their consent.
Despite this, the company is reportedly testing a prototype of AI glasses that would “continuously collect audio while taking photos every few seconds,” sources recently told Financial Times.
Meta’s blog post about the glasses feature attempts to assuage people’s fears about the devices’ privacy by answering questions like “who can see the photos and videos I take on my glasses?” Meta answers by promising, “You, and only you — unless you choose to share them.” Yet, Meta’s privacy policy has explained that any image you share with Meta AI can be used to train its AI.
Image Credits:Meta (screenshot of privacy policy on July 8, 2026) All the while, the company is facing multiple investigations and lawsuits over Meta AI glasses privacy violations. One lawsuit comes after Meta notably canceled a contract with an outsourced tech firm after some of its Kenyan workers alleged they had to view graphic content, like sex, nudity, and people using the toilet, while training Meta’s AI using people’s Meta AI glasses’ videos.
These are hardly Meta’s first scrapes with privacy violations or safety measures, either.
Arguably, Meta’s reputation on privacy has been tainted for years after numerous leaks and lost lawsuits about its alleged lack of child safety measures and desire for growth at all costs. There are books by whistleblowers documenting its alleged abuses, not to mention previous large-scale privacy disasters, like the Cambridge Analytica data scandal and others.
After the 2018 Cambridge Analytica scandal, Meta now insists on its Privacy Progress Update page, “Since 2019, we’ve invested significantly in people, products, and technology to continue to evolve our rigorous privacy program.”
Still, the company plows forward with what many people would consider privacy-violating ideas. Case in point: On the same day it announced the Meta glasses’ new safeguard, it shared that Meta AI can now use anyone’s public Instagram photos to make AI images, unless you opt out.
It also built features to use Meta AI on images in your Camera Roll you’ve never shared and implemented such poor privacy controls in its Meta AI app, leading users to essentially dox themselves by revealing their embarrassing searches.
This is the same company that Apple wouldn’t partner with due to privacy concerns, that records its employees’ keystrokes to train its AI, and that plans to sell targeted ads based on data in your AI chats.
So, while an LED safeguard on AI glasses might be a necessary feature, consumers clearly still have many reasons to remain distrustful of how social media will use their images and data, especially in its broader AI plans.
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Sarah has worked as a reporter for TechCrunch since August 2011. She joined the company after having previously spent over three years at ReadWriteWeb. Prior to her work as a reporter, Sarah worked in I.T. across a number of industries, including banking, retail and software.
You can contact or verify outreach from Sarah by emailing [email protected] or via encrypted message at sarahperez.01 on Signal.
Key Takeaways Meta Platforms unveiled Muse Image, adding AI image creation and editing to Meta AI and its apps.Muse Image brings templates, markup edits, infographics and room redesign tools to users.META plans Advantage access for advertisers as 8 million already use its generative AI tools. Meta Platforms (META - Free Report) has unveiled Muse Image, its first image-generation model from Meta Superintelligence Labs, expanding the capabilities of Meta AI beyond conversational assistance into AI-powered visual content creation. The new model enables users to generate, edit and personalize images using natural-language prompts across Meta AI, while also introducing AI-powered creative tools for Instagram Stories and image generation in WhatsApp chats. The rollout will gradually extend to Facebook, Messenger and additional Instagram surfaces, with advertisers gaining access through Advantage+ creative in the coming weeks.
Muse Image offers several advanced features, including text rendering within images, photo editing through markup, AI-generated infographics, room redesigns using products from the web or Facebook Marketplace and the ability to incorporate public Instagram content into personalized visuals. META is also introducing preset templates to simplify content creation and plans to expand the model into AI-powered video generation through the upcoming Muse Video platform.
Muse Image Strengthens Meta's AI Monetization StrategyMuse Image aligns closely with Meta Platforms’ broader AI strategy outlined during its first-quarter 2026 earnings conference call. Management emphasized that the release of the Muse family of models, beginning with Muse Spark, marked a major milestone in building personal and business AI agents for billions of users. The company noted that stronger AI models are enabling Meta to launch entirely new products while increasing user engagement across its ecosystem.
The addition of Muse Image extends this strategy by giving users compelling reasons to spend more time within META’s apps rather than relying on third-party AI image generators. AI-generated visuals can drive higher engagement across Instagram, Facebook, Messenger and WhatsApp, supporting the company’s recommendation systems and increasing advertising inventory. According to management, Meta AI usage has risen significantly following the rollout of Muse Spark, with double-digit increases in sessions per user, reinforcing confidence that richer AI experiences can deepen platform engagement.
Muse Image also creates meaningful monetization opportunities. Meta Platforms already reported that more than 8 million advertisers use at least one of its generative AI creative tools, while advertisers using AI-generated video features achieved more than 3% higher conversion rates in testing. Integrating Muse Image into Advantage+ creative should further simplify ad creation for businesses, particularly small and medium-sized advertisers, improving campaign performance and encouraging greater advertising spend. Advertising revenues were $55.02 billion in the first quarter of 2026, up 33% year over year, and accounted for almost 98% of META’s revenues.
META Faces Tough Competition in the Ad SpaceMeta Platforms is facing stiff competition from the likes of Alphabet (GOOGL - Free Report) and Amazon (AMZN - Free Report) in the ad domain.
AI is driving Alphabet’s Search & Other revenues, which grew 19% year over year in the first quarter of 2026. Gemini Enterprise’s paid monthly active users grew 40% sequentially, while revenues from products built on Google’s generative AI models increased nearly 800% year over year. Alphabet’s total paid subscriptions reached 350 million, driven in part by Gemini app adoption and premium AI plans. The company has cited a more than 30% reduction in the cost of core AI responses since upgrading AI Overviews and AI Mode to Gemini 3, and a more than 35% reduction in search latency over the past five years. This mix of usage growth and efficiency supports continued investment while keeping Search economics intact.
Amazon’s advertising business continues rapid expansion as brands allocate more marketing budgets to its platform, leveraging its valuable consumer data and purchase intent signals. Advertising services revenues jumped 24% year over year to $17.2 billion in the first quarter of 2026, and advertising revenues grew to more than $70 billion in trailing-12-month revenues, reflecting successful AI-powered optimization of the platform and growing market share in digital advertising.
META’s Share Price Performance, Valuation & EstimatesMeta Platforms shares have dropped 6.8% year to date, underperforming the broader Zacks Computer and Technology sector’s return of 14.7%.
META Stock’s Price Performance
Image Source: Zacks Investment Research
Meta Platforms stock is trading at a premium, with a forward 12-month price/sales of 5.57X compared with the Zacks Internet Software industry’s 3.89X. META has a Value Score of C.
META’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for 2026 earnings is pegged at $33.11 per share, up 0.3% over the past 30 days, suggesting 41% year-over-year growth.
Meta Platforms currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Meta Platforms (META 1.76%) started the month with a bang. Its shares climbed 9% on July 1 after the company revealed that it will begin leasing some of its surplus computing power to customers. The launch of this new cloud computing business was in line with earlier comments from CEO Mark Zuckerberg, who said on Meta's first-quarter earnings conference call that the social media giant could sell some of its capacity at a premium if it feels that it has overbuilt for its in-house needs.
According to Bloomberg, Meta is still debating whether to offer AI models that run on its infrastructure, or simply sell direct access to computing power. Meta has developed its own large language models (LLMs), although they're primarily for internal use. Specifically, the company deploys these models to optimize its content recommendation engine, helping keep users on its sites longer, and to help advertisers better target and convert customers.
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Earlier this week, it introduced its first image generation model: Muse Image, which was developed by its Superintelligence Lab, and which will work in conjunction with its Muse Spark text model. Muse Image will help power Meta's advertiser-focused image generation tools to help marketers more easily create and adjust ad campaigns. Muse Image will be available to consumers for free on a limited basis, and Meta will also offer a monthly subscription.
Offering both cloud computing capacity and its AI models would help Meta compete with Amazon, Microsoft, and Alphabet -- the world's three biggest cloud computing providers -- and provide the company with another revenue source. Most importantly, though, the announcement should help ease investors' concerns about the company's high spending on AI infrastructure. Meta has announced plans to spend up to $145 billion on capital expenditures (capex) this year, largely tied to its AI efforts. Creating a cloud computing arm would allow it to allocate and shift compute capacity between itself and customers, giving it more flexibility.
Image source: The Motley Fool.
Is the stock a buy? In my view, Meta is one of the most undervalued mega-cap tech stocks in the market today. It trades at a forward price-to-earnings (P/E) ratio of just 19 times 2026 analyst estimates and below 17 times 2027 estimates/ Meanwhile, in Q1, it grew its revenue by 33% year over year.
Meta has been one of the best companies at applying AI to its core business to drive growth, and its new cloud computing unit should help allay investors' fears about its capex plans. Given its valuation and growth, and the removal of that overhang, I would be a buyer of the stock at current levels.
Geoffrey Seiler has positions in Alphabet, Amazon, and Meta Platforms. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, and Microsoft. The Motley Fool has a disclosure policy.
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#1 (Strong Buy) stocks have produced an unmatched +23.94% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.
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To maximize your returns, you want to buy stocks with the highest probability of success. This means picking stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you find yourself looking at stocks with a #3 (Hold) rank, make sure they have Scores of A or B as well to ensure as much upside potential as possible.
The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.
A stock with a #4 (Sell) or #5 (Strong Sell) rating, for instance, even one with Scores of A and B, will still have a declining earnings forecast, and a greater chance its share price will fall too.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Meta Platforms (META - Free Report) Meta Platforms is the world’s largest social media platform. The company’s portfolio has evolved from the Facebook app to multiple apps, including photo and video sharing app Instagram and WhatsApp messaging app, largely through acquisitions. Along with in-house developed Messenger and newer services such as Threads, these products form Meta’s Family of Apps, which reached about 3.56 billion daily active people on average in March 2026.
META is a #3 (Hold) on the Zacks Rank, with a VGM Score of A.
Momentum investors should take note of this Computer and Technology stock. META has a Momentum Style Score of B, and shares are up 5.3% over the past four weeks.
Two analysts revised their earnings estimate higher in the last 60 days for fiscal 2026, while the Zacks Consensus Estimate has increased $0.18 to $33.11 per share. META also boasts an average earnings surprise of +12.3%.
With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, META should be on investors' short list.
Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
Meta Platforms (META 1.76%) recently made a big announcement that caused neocloud stocks like Nebius (NBIS +4.51%) and Iren (IREN +2.90%) to stumble. Facebook's parent company said it would explore building its own neocloud business and renting out its excess compute capacity.
That aligns with the company's earlier announcement of intent to build tens of gigawatts of AI data centers this decade and hundreds of gigawatts of capacity over time. However, investors shouldn't rush to imagine Meta Platforms running a vibrant neocloud division under its corporate umbrella.
Image source: Getty Images.
Meta Platforms needs more compute Companies like Nebius and Iren aren't using the data center capacity they're building to develop their own large language models or physical AI systems. They are AI enablers.
Meta Platforms still needs computing power for its own initiatives, such as AI models and smart glasses. It's also using artificial intelligence to enhance the effectiveness of the advertising on its platforms to drive more revenue.
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Meta Platforms signed a bunch of deals last year to obtain more computing power to support its AI ambitions, and that trend continued this year. It has already inked extended agreements with CoreWeave and Nebius.
The fact that Meta Platforms is still scrambling to sign these types of deals shows that it won't have available compute capacity to lease to other companies anytime soon. Other hyperscalers and AI giants are also ramping up these types of deals. For instance, Anthropic recently secured 401 megawatts of capacity from Terawulf via a 20-year, $19 billion contract.
There isn't enough cloud computing capacity in Meta Platforms' grasp to run its own AI businesses and supply more to outside enterprises. As long as this gap exists, Meta Platforms won't have an immediate path into the neocloud industry.
AI data centers take years to build Meta Platforms CEO Mark Zuckerberg has expressed his desire to build many AI data centers for the company, but each of those projects will take years to complete. For instance, Meta Platforms' Hyperion project won't be completed until 2030. That will be a massive 5-gigawatt (5,000-megawatt) data center upon completion, but considering how Meta Platforms' demands for in-house compute are rising, it's tough to predict how much of that capacity it will be able to make available for smaller enterprises.
When it comes to the neocloud opportunity, Meta Platforms is sitting on the fence. It's primarily an online advertising company that is on the verge of tapping into artificial intelligence in ways that translate into meaningful revenue growth. This technology could finally help Meta Platforms meaningfully diversify beyond online ads, just as Alphabet did more than a decade ago.
However, when it comes to neocloud, companies like Iren and Nebius have better shots at gaining market share and winning over hyperscalers and small enterprises alike. By the time Meta Platforms is ready to enter the neocloud arena in a meaningful way, Iren and Nebius may have more than doubled their existing gigawatt inventories.
Investors should be excited about Meta's AI glasses, which were recently released. We should get an update about that product when it delivers its second-quarter report. However, what Meta's entry into the neocloud industry might look like remains to be determined.
This is a fair market value price provided by Massive. Learn more.
52-Week Range$520.26▼
$796.25Dividend Yield0.35%
P/E Ratio21.98
Price Target$840.64
Shares of the Magnificent Seven giant Meta Platforms NASDAQ: META recently received a serious boost after the company’s potential cloud push moved closer to reality. Shares jumped 8.8% on July 1 due to reports that it plans to sell its excess compute capacity to third parties.
While the market’s reaction was clearly positive, if Meta follows through, the move has both positives and negatives for investors to consider. Although Meta’s cloud push could be a significant source of revenue and profit, it also raises questions about the long-term competitiveness of its AI products.
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Positives on Selling Compute: AI Monetization and Spending SignalsAmong the biggest reasons markets reacted positively to Meta’s cloud computing push is what it means for the firm’s ability to generate new AI revenue. As the company rents its computing capacity to other firms, Meta may be able to generate significant margins on its capital expenditures (CapEx).
When thinking about Meta’s positioning in the cloud computing space, neoclouds like CoreWeave NASDAQ: CRWV offer a solid comparison point. This comes as CoreWeave exclusively targets AI infrastructure demand, while longer-standing companies like Microsoft NASDAQ: MSFT target both AI and non-AI demand.
With Meta’s AI infrastructure heavily concentrated on graphics processing units, the company would operate in a similar space as CoreWeave. Thus, examining CoreWeave can help provide a glimpse into the extent to which Meta could benefit from entering the cloud computing market.
Last quarter, CoreWeave generated revenue of $2.08 billion. Off this, the company’s adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) were approximately $1.2 billion. Achieving something similar could add a meaningful uplift for Meta, whose calculated Q1 2026 EBITDA was approximately $28.87 billion. Still, as Meta enters the market, the added competition could push down margins in this space.
However, with the overall demand for compute still very much on the rise, Meta could have a significant growth opportunity from there. Additionally, the recent deal SpaceX NASDAQ: SPCX signed with Alphabet NASDAQ: GOOGL suggests that Meta could scale cloud revenue significantly faster than CoreWeave. Alphabet will pay SpaceX $920 million per month to lease computing assets, implying $2.76 billion in quarterly revenue.
Another important implication is what the move signals about Meta’s CapEx spending going forward. If Meta already believes it has excess compute, it suggests that the company may not need to spend as heavily on CapEx in the future. Meta’s elevated and increasing CapEx spending has arguably been the largest overhang on its stock price. In turn, a signal that this trend could potentially revert is a positive for many investors.
The Negatives: Selling Compute Indicates AI Product WeaknessOn the negative side, Meta’s willingness to sell compute suggests it does not have enough strong internal use cases for that compute, raising questions about its broader competitiveness in delivering AI products.
Overall MarketRank™100th Percentile
Analyst RatingModerate Buy
Upside/Downside39.7% Upside
Short Interest LevelHealthy
Dividend StrengthWeak
News Sentiment0.70 Insider TradingSelling Shares
Proj. Earnings Growth19.38%
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The timing of this pivot is noteworthy given the release of Meta’s Muse Spark model several months ago, which is far more intelligent than its predecessors. The move to sell excess compute indicates that the development of Muse Spark-related products may not be proceeding as quickly as hoped. This comes as such products would likely require more compute to support their usage. In fact, recent reports state that CEO Mark Zuckerberg told employees that the pace of the company’s AI agent development has been slower than expected.
Furthermore, it is important to note that the details of Meta’s cloud push are very limited at this point. At present, it is unclear how much of Meta’s compute it considers to be in excess of its internal needs. Meta’s view on this is important, as its level of excess compute capacity would directly translate into the amount of revenue it could generate from its cloud push.
Notably, statements made in Meta’s most recent earnings call push back against the idea that it has significant excess compute. Chief Financial Officer Susan Li stated, “Our experience so far has been that we have continued to underestimate our compute needs.” She went on to note, "Our expectation is that compute will become even more central to the business going forward.”
Meta’s Next Earnings Call Could Provide Significant Clarity on Cloud AmbitionsOverall, Meta has yet to provide any concrete comments on its cloud push. Given the significant implications for Meta’s outlook, it will likely be a key topic of discussion during the firm’s next earnings call.
When Meta addresses cloud computing directly, investors should monitor the extent to which Meta plans to provide compute to third parties. This should provide more detail around what Meta believes its revenue opportunity is and its level of confidence in marketing its own AI solutions.
Should You Invest $1,000 in Meta Platforms Right Now?Before you consider Meta Platforms, you'll want to hear this.
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The AI wave will soon hit public markets with Anthropic and OpenAI set to go public later this year. However, you don't have to wait to invest. This report shows seven AI stocks that you can buy today while the big model providers get ready to go public.
TeraWulf stock is trending lower. Why are WULF shares declining? Broader Sector HeadwindsAdding to the pressure, cryptocurrency markets have broadly declined today— a meaningful headwind for TeraWulf, which still operates a Bitcoin mining business alongside its AI infrastructure pivot. Bitcoin is down 1.68% to $62,087.
Meta Enters the AI Cloud MarketTeraWulf Shares Edge LowerWULF Price Action: At the time of publication, TeraWulf shares are trading 1.53% lower at $19.92, according to data from Benzinga Pro.
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This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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Meta Platforms (NASDAQ:META | META Price Prediction) has been through the wringer. The stock is down 18.05% over the past year and 11.54% year to date, with a brutal 4.9% single-day drop on July 2, 2026. After running the numbers, the selloff looks overextended relative to fundamentals.
Our 24/7 Wall St. price target for Meta is $828.63, implying 42.16% upside from $582.90. The recommendation is buy, with high confidence at 90%.
24/7 Wall St. Price Target Summary Metric Value Current Price $582.90 24/7 Wall St. Price Target $828.63 Upside 42.16% Recommendation BUY Confidence Level 90% How a $1.28 Trillion Giant Fell Out of Favor Meta peaked near $785.23 in August 2025 before grinding lower into July 2026. The catalysts for the pullback were largely self-inflicted: management raised FY2026 capex guidance to $125-145 billion, up from the prior $115-135 billion range, citing higher component pricing and data center costs. Reality Labs is still bleeding, with a $4.03 billion operating loss in Q1 2026.
Yet the underlying business is roaring. Q1 2026 revenue jumped 33.1% YoY to $56.31 billion, ad impressions rose 19%, and price per ad climbed 12%. That is Meta’s fifth consecutive EPS beat. Reddit captured the mood best with a viral wallstreetbets post about “Suckerberg panic bought the entire AI chip supply,” which drew 13,591 upvotes.
The Case for $868 and Higher The bull scenario projects $868.79, or 49.05% upside. The core drivers: Meta Superintelligence Labs released its first model in Q1, 3.56 billion daily active people across the Family of Apps, and AI-driven ad targeting that is compounding pricing power.
Ray-Ban Meta glasses give Meta the early lead in AI wearables. Of 63 analysts covering the stock, 57 rate it Buy or Strong Buy with zero sells. The forward P/E sits at just 19, a modest multiple for a business compounding earnings at this rate.
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What Could Go Wrong The bear case targets $720.38, still 23.59% above spot. Risks are real: FY2025 free cash flow fell 19.39% as capex nearly doubled, youth-related litigation trials are scheduled through 2026, and Q1’s $10.44 EPS was flattered by a $3.13 per share tax benefit from Treasury Notice 2026-7. Normalized operating EPS was closer to $7.31.
Bulls would counter that the capex ramp is building the AI infrastructure that already powered 33.1% Q1 revenue growth. Operating income still rose 30.29% YoY, and the balance sheet remains fortress-grade with interest coverage of 71x.
Meta Price Prediction 2026-2030 The 24/7 Wall St. price target of $828.63 reflects a rare setup: a mega-cap with 42.16% modeled upside, 90% confidence, and a Street that is uniformly constructive. The tie-breaker is valuation.
A 19 forward P/E on a business growing revenue at 33.1% is asymmetric. The setup strengthens if Q2 revenue lands at the high end of the $58-61 billion guide. Risks intensify if Reality Labs losses balloon or capex guidance climbs again.
Year 24/7 Wall St. Price Target 2026 $828.63 2027 $975 2028 $1,140 2029 $1,335 2030 $1,549.79 These projections assume Meta continues executing on AI monetization and family of apps growth. Significant upside could come from Reality Labs turning profitable; downside risk hinges on regulatory outcomes and capex discipline.
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France's competition authority on Wednesday ordered Meta Platforms to resume talks with French media groups over payments for publishing content, after the publishers complained following the collapse of previous negotiations.
As big tech companies pour billions of dollars into data centers for artificial intelligence (AI), investors are growing concerned about whether all this spending will actually pay off. Meta Platforms (META +2.59%) has faced particular investor scrutiny because, unlike Amazon, Alphabet, and Microsoft, it doesn't currently sell cloud computing services to outside companies.
But it seems that's about to change.
According to a Bloomberg report, Meta is developing a business plan to lease its excess data center capacity. It's fantastic news for investors and comes on the heels of Mark Zuckerberg's January announcement of Meta Compute, an initiative to build tens of gigawatts of compute capacity this decade.
Image source: The Motley Fool.
There's room for Meta to build out a cloud business Nobody's quite sure where the data center boom will ultimately go, but it's clear that AI is sending demand for computing capacity through the roof. Experts believe global data centers will bring tens to hundreds of gigawatts of compute online over the next decade and beyond.
It seems far-fetched, but remember, AI adoption has only just begun. Agentic AI is a near-term growth catalyst, and there's still an ocean of potential in physical AI applications, such as autonomous vehicles and humanoid robotics. There's likely room for another cloud computing competitor, and Meta is probably already large enough on the infrastructure side, even if it's not selling it yet.
Meta will need to think through its go-to-market strategy to succeed. The incumbent cloud service providers are ecosystems that span well beyond compute, including developer tools, security, and other resources. Meta will either need to duplicate that -- arguably a tall order -- or find another angle.
Maybe it could leverage its enormous size and sell raw compute to targeted customers who don't need all the other bells and whistles. If so, even a limited footprint in a massive cloud market can help lift returns on Meta's AI spending.
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Meta Compute is as much a risk as it is an opportunity Anything near the tens of gigawatts Mark Zuckerberg called for will cost a mountain of capital. For instance, OpenAI and other backers are funding Project Stargate, an AI data center project targeting 10 gigawatts of capacity. The joint venture's estimated total investment is an eye-watering $500 billion.
There are also ancillary challenges, such as sourcing enough power for these data centers -- there's a reason that Elon Musk is trying to put data centers in orbit. Fortunately, Meta has generated more than $48 billion in free cash flow over the past year thanks to its exceptionally profitable and growing core advertising business.
Almost any way you slice it, Meta is making a massive financial gamble on data centers and AI. It's great news that Meta is exploring different ways to justify its enormous AI and data center investments. That said, you'll probably want to be on board with Mark Zuckerberg's AI plans to begin with if you're going to buy the stock.
Justin Pope has positions in Alphabet, Meta Platforms, and Microsoft. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, and Microsoft. The Motley Fool has a disclosure policy.
Meta Platforms (META +2.59%) could spend as much as $145 billion on AI in 2026 alone. That is a staggering amount of money, and Wall Street has grown increasingly nervous that the spending spree will yield enough returns to keep shareholders happy. Meta now appears to be looking to sell its excess computing power, much like competitors Amazon and Space Exploration Technologies (SpaceX).
Should investors care about this particular move? Let's have a look at what it could potentially mean for shareholders.
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This plan enables Meta to create another revenue stream that partially offsets the incredible cost of the AI build-out. This should ease at least some of the investors' concerns. Meta's stock has been sluggish over the past year. It's down more than 15% in the past 12 months and 7% in 2026, as of this writing.
Other large tech companies have been doing this for years, so Meta will need to compete in a well-established market filled with entrenched competitors.
Image source: The Motley Fool.
Should investors care about this? Yes, and they should be cautiously optimistic. This is a good move by Meta, but it's not a slam dunk. It could offset AI costs, but it might not become a profit center anytime soon. The bearish view of this move is that Meta is realizing AI capital expenditures have gone too far, and this is one way to begin recouping from an overly expensive endeavor.
If Meta can successfully sell its excess compute power and create another strong revenue engine, now could be a good time for investors to buy in and benefit from the move. Because Meta has struggled in the past year, its valuation metrics are currently attractive. The company is trading with a forward P/E ratio of less than 20.
Still, I'm not convinced this isn't just a way to reverse course on an overly ambitious spending spree.
Catie Hogan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon and Meta Platforms. The Motley Fool has a disclosure policy.
Shares of Meta Platforms (META +2.59%) were heading lower last month as a slew of concerns mounted for the social media giant. Among those were layoffs, overspending on AI and capital expenditures, and a lack of direction in artificial intelligence, as the company has struggled to develop a meaningful revenue stream beyond advertising.
The stock also fell on a report that it would sell new shares to fund its AI ambitions. By the end of the month, shares had given up 11%, according to data from S&P Global Market Intelligence.
As you can see from the chart below, the stock fell steadily throughout the month.
META data by YCharts
Why is Meta sliding? Meta is the only one of the four hyperscalers, which includes Amazon, Microsoft, and Alphabet, to not have its own cloud computing business, though a report broke in July that said it would launch one.
The lack of cloud computing business makes its plans to spend a $125 billion-$145 billion on capital expenditures this year especially risky, and the stock paid the price for it last month.
On June 5, the stock fell 6% after Financial Times reported that the company had been considering raising tens of billions of dollars in a stock offering to support its AI-related spending. The sell-off is understandable as Meta is burning approximately $20 billion a year on Reality Labs, its division that supports its AI projects, and investors have yet to see a return on that investment.
As evidence of the ongoing backlash against social media, the U.K. banned social media for children under 16, which could add to calls for other companies to do the same.
Meanwhile, other reports indicated that morale was low at the company following several rounds of layoffs and after CTO Andrew Bosworth told Wired that its AI reorganization was "atrocious." The head of product for "AI for Work" also said she was leaving the company shortly after being named to the position.
Image source: The Motley Fool.
What's next for Meta The stock popped on July 1 after Bloomberg reported that the company was planning to launch its own cloud computing business, news that came weeks after CEO Mark Zuckerberg said that the idea was "definitely on the table."
Following the stock's sell-off in recent months, Meta stock looks cheap, trading at a price-to-earnings ratio of just around 24 after adjusting for a one-time tax gain in the first quarter.
That looks like a great price to pay for a company that just grew revenue by 33%, but Meta will have to convince investors it's spending its capex dollars wisely in order to unlock the stock's potential.
Jeremy Bowman has positions in Amazon and Meta Platforms. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, and Microsoft. The Motley Fool has a disclosure policy.
Analyst’s Disclosure: I/we have a beneficial long position in the shares of META either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
