META is growing a neocloud business under everyone’s nose
u/denialof_ ·
Reddit — r/ValueInvesting
· May 15, 2026 at 15:41
· ⬆ 44 pts
· 💬 38 comments
| View on Reddit ↗
AI Summary
Summary
The author argues that Meta is quietly building a neocloud business (similar to AWS) by leveraging its massive capital expenditure on internal AI infrastructure, which could be monetized externally.
Thesis: Meta’s capital investments are mispriced by the market as ad spend, when they actually represent a hidden cloud/GPU-as-a-service business, making the stock undervalued relative to growth.
Quality assessment: Speculative but grounded in observable CapEx trends and analogous to Amazon’s Trainium commentary; the author provides no hard financial breakdown, so it’s more opinion than deep-dive DD.
Score44
Comments38
Upvote %83%
▶ Full Post Text
Meta is literally building a neocloud business under everyone’s nose similar to how Amazon built AWS.
Currently all resources are being ‘sold’ internally but if you look at the capital investment how is it not obvious that they are building as much supply as possible leveraging their balance sheet and cash flow to grow an entirely new business unit at massive scale.
Look at Amazons commentary on the chip revenue they could gain if they sold trainium externally instead of for internal use - this is the same thing happening within Metas cloud infrastructure but people are worried about the ROI on their ads business.
Discount to market multiple is a complete dislocation.
Edit: see comments below for where sentiment is on the stock. Unloved, priced cheaper than market multiple and growing faster than the market. Fat pitch.
Meta is investing billions in infrastructure for internal AI workloads, but the capacity could be sold externally (neocloud model), echoing Amazon’s AWS/ Trainium monetization story. The market is discounting Meta’s growth because it views CapEx as a cost, not an asset; if the neocloud narrative gains traction, multiple expansion toward cloud peers is likely. Long Meta as an undervalued growth stock with a hidden cloud catalyst, trading below market multiple despite faster growth. If Meta fails to actually sell external cloud services, or if ad revenue decelerates, the narrative collapses; also regulatory scrutiny or oversupply in GPU capacity could hurt.