Meta Platforms’ shares crashed 10.3% in Thursday’s trade, 30 April, to hit a two-week low of $600 apiece, marking the company’s biggest intraday decline in six months, as investors worried that the company’s rapid spending on artificial intelligence may not generate returns quickly enough, overshadowing an otherwise better-than-expected March quarter performance.
Meta reported first-quarter sales of $56.3 billion, ahead of Wall Street estimates of $55.51 billion, and guided current-quarter revenue in the range of $58 billion to $61 billion, broadly in line with expectations. Net income for the quarter was $26.8 billion, according to the company’s press release.
The social media giant raised its 2026 capital expenditure target by another $10 billion to around $145 billion, up from its earlier forecast of $115 billion to $135 billion.
However, the company offered limited clarity on how that spending would translate into shareholder returns, while also warning of rising costs and capacity constraints. In addition, capex growth is now significantly outpacing revenue growth, intensifying investor concerns.
Meta’s Chief Executive Officer, Mark Zuckerberg, has said the company will spend hundreds of billions of dollars on AI infrastructure by the end of the decade, and that was before a memory chip shortage triggered a sharp surge in hardware prices.
Since the beginning of this year, Meta has announced multi-billion-dollar deals with Nvidia, Advanced Micro Devices, and Broadcom for chips and related hardware, while also building several massive data centres to power its AI ambitions.
As spending on AI continues to rise, the company has recently introduced several cost-cutting measures. Last week, it informed employees through an internal memo that it would cut roughly 8,000 jobs and leave another 6,000 open roles unfilled.
Adding to investor concerns, Meta also reported its first-ever quarterly decline in Daily Active People (DAP), a metric that tracks users across its social media platforms. The company attributed the decline to internet disruptions in Iran and restrictions on access to WhatsApp in Russia.
Another key concern weighing on sentiment is the intensifying AI race, which is making it increasingly difficult for investors to assess when such heavy spending will begin yielding meaningful payoffs.
Big Tech companies are currently locked in a battle for dominance in artificial intelligence, pouring enormous sums into data centres, chips, and supporting infrastructure.
The four largest technology firms, including Meta, are now expected to spend as much as $725 billion on AI-related investments this year.
Meta also warned that legal and regulatory blowback in the European Union and the US “could significantly impact our business and financial results,” after years of mounting criticism about children’s safety on social media.
Stock down 25% from recent peak
Shares of the Facebook and Instagram parent have struggled to regain momentum on Wall Street since touching a record high of $796 in August 2025. The stock has ended five of the last nine months in the red, losing a cumulative 22% based on Thursday’s intraday low. The prolonged correction has now pulled the stock nearly 25% below its all-time high.
However, the recent weakness follows a sustained bull run between November 2022 and July 2025, during which the stock rallied from $93.16 to $773, delivering a massive gain of nearly 730%.
(With inputs from agencies)
Disclaimer: We advise investors to check with certified experts before making any investment decisions.
