Meta stock falls on aggressive AI bet

Shares of Meta took a nosedive after the company announced its aggressive AI spending plans.

Transcript

00:00 I'm Caroline Woods reporting from the New York Stock Exchange. Here's what we're watching on

00:03 the street today. Wall Street is looking ahead to key inflation data out Friday.

00:08 The Fed's preferred inflation gauge, the Personal Consumption Expenditures Price Index,

00:13 measures how much consumers are spending on goods and services. This will be the final

00:17 data point on inflation before the Fed makes its interest rate decision on May 1st. Markets

00:23 are pricing in a 96% chance that the central bank holds rates steady. Meanwhile, shares of

00:29 Meta fell sharply after the company announced higher-than-expected spending on artificial

00:33 intelligence in its first-quarter earnings report. The tech giant said it expects to spend anywhere

00:38 between $35 and $40 billion in the coming year, up from a previous estimate of $30 to $37 billion,

00:45 driven heavily by investments in AI. On an earnings call with investors,

00:50 CEO Mark Zuckerberg doubled down on AI, saying Meta wants to be the leading AI company in the world,

00:57 adding that the company needs to increase spending meaningfully before expecting to generate revenue

01:01 in AI. These comments spooked investors and threatened to wipe almost $163 billion off

01:07 its market value. This all comes roughly a week after Meta deployed its AI assistant on Instagram

01:13 and Facebook. Meta says the tool has been used by tens of millions of users.

01:18 That'll do it for your daily briefing. From the New York Stock Exchange,

01:22 I'm Caroline Woods with The Street.

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