Meta Platforms has announced plans to invest up to $65 billion in artificial intelligence initiatives in 2025, which includes constructing an enormous new data center. CEO Mark Zuckerberg described the proposed facility as being large enough to cover a significant portion of Manhattan. This ambitious investment aims to bring about 1 gigawatt of computing power online and sees the company aiming to have over 1.3 million graphics processing units operational by the end of 2025.

Zuckerberg emphasized that this substantial investment is part of a broader movement to enhance Meta’s core products and foster historical innovation that will reinforce American technological leadership. Meta has previously made significant strides in AI, already having committed to building a new $10 billion data center in Louisiana, while also acquiring new computer chips for various AI-centric products, such as its smart glasses and AI assistant.

Zuckerberg’s announcement follows a recent joint venture between OpenAI, SoftBank Group, and Oracle Corporation, aimed at creating a robust AI infrastructure across the U.S. This $100 billion venture is focused on building out data centers to support AI projects.

The anticipated capital expenditure represents a significant jump—approximately 50% higher than Meta’s estimated spending for 2024 and more than double that of 2023. Bloomberg data reveals that Wall Street analysts were predicting around $51.3 billion for capital expenditures in 2025 for Meta. While shares of Meta initially dipped in premarket trading after the announcement, they rebounded by as much as 1.7% once markets opened, indicating positive sentiment among investors.

Moreover, Broadcom, which provides chip design services to Meta, saw its stock rise by about 3.9% in response to Zuckerberg’s announcement.

In a prior statement, Zuckerberg acknowledged the possibility that tech companies, including Meta, may be overextending themselves in the AI space, but he rationalized the investment as a necessary risk, stating that being inadequately prepared for a major technological shift may be far more detrimental than overspending. He noted the vital importance of keeping pace with the most significant technological advancements expected in the next decade and a half.

While Zuckerberg’s public disclosure of Meta’s spending intentions on social media prior to the quarterly earnings announcement is atypical, federal regulators have validated the practice of using social media platforms for significant corporate disclosures.

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