“Meta’s Bold AI Gamble: Zuckerberg Defends Spending Amid Share Market Tumble”
In a world where Artificial Intelligence (AI) is becoming an inevitable factor of innovation, Meta is not holding back. Mark Zuckerberg, CEO of Meta, is defending an aggressive spending spree on AI technology despite shares tumbling by more than 15%.
Meta's revenue performance for Q1 2024 saw figures rise 27% to $36.5bn against an anticipated $36.2bn. However, there's been a significant increase in its full-year capital expenditure from $37bn to $40bn to bolster its involvement in AI infrastructure investments.
Last year, Zuckerberg concentrated on cost-efficiency, slashing jobs, and reducing costs. But, to keep Meta ahead of key players like OpenAI, Microsoft, Alphabet’s Google, and to lead the AI global race, Zuckerberg is fueling more resources towards AI technology and infrastructure investments.
Meta’s shares fell significantly after hours, a spike of contrast for a stock that was previously performing well. It had surged more than 40% this year, reaching a record high after strong Q4 2020 earnings.
Apart from integrating AI tools into its products, Meta is also utilizing chatbots for its social media applications to drive user engagement and improve advertisement targetting. Its latest AI model, Llama 3, displays advanced reasoning capabilities.
Investors poked at Zuckerberg about the planned spending increase in the earnings calls to which he defended stating the company’s “strong track record” of monetisation. The question remains, can Meta's bold bet on AI technology deliver the promised growth and lead the pack in the global AI race?
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