Meta Shares Plunge as AI Investments Raise Spending Outlook

Summary

Meta shares fell after raising its 2025 CapEx guidance to $125-145B, far above estimates, while Q2 revenue guidance came in line with expectations. Analysts discuss the challenge of proving AI investment payoffs without a cloud business and the growing regulatory overhang from addiction lawsuits.

• Meta raised full-year CapEx guidance by about $10B, now $125-145B.
• Q2 revenue guidance was in line with estimates, missing typical upside surprises.
• Stock declined as the market weighed higher spending without revenue acceleration.
• Analysts question how Meta will monetize AI without a cloud business.
• Potential new revenue streams include API access and consumer AI subscriptions.
• Regulatory overhang from social media addiction lawsuits poses financial and reputational risks.
• Kurt Wagner notes the long-term nature of legal and reputational headwinds.
• Host Romaine Bostick moderates the discussion with guest Kurt Wagner and analyst Rob Reiner.