Meta CEO Mark Zuckerberg has admitted that the company committed to spending as much as $200 billion on artificial intelligence (AI) infrastructure without knowing for certain if its products would succeed.
In its previous quarterly results, Meta reported its lowest free cash flow in years. His comments offer a rare look at the uncertainty behind Meta’s costly push to compete with leading AI companies. “You sure this is going to work? The comments come as investors seek clearer signs that Meta’s rising AI expenses will lead to stronger sales and profits. He recalled that the company expected to make changes to the product after its launch. Meta is investing heavily in data centres and other infrastructure to compete with Alphabet, OpenAI and Anthropic. The scale of its spending has raised questions about how fast the company can turn its AI work into profits. The company’s new AI model and consumer assistant could offer clues about whether its huge investment is beginning to deliver the results shareholders expect. (With Bloomberg Inputs)
The figure reflected growing expenses linked to data centres and smart glasses, and its shares fell 8% after the results. Investors will get another update when Meta reports its latest financial results after the market closes on October 21.
“We’re going to write this check for like, I don’t know, $100 billion or $200 billion,” Zuckerberg said on the podcast, recalling his conversation with Wang. Wang said there was no clear guarantee that the investment would succeed. Recalling the uncertainty surrounding the project, he said it was “not clear at all that it was going to work,” despite the “obscenely large” amount of money Meta was investing. Meta Chief Financial Officer Susan Li also warned about the potential cost of failure, Zuckerberg said. However, Zuckerberg said he was not certain how consumers would respond to Muse.
Speaking on the Cheeky Pint podcast , published on Monday, Zuckerberg recalled questioning Chief AI Officer Alexandr Wang about whether the huge investment would pay off.
Meta has also launched Muse, a personalised AI assistant designed to help users with tasks such as shopping, booking movie tickets and scheduling appointments. The new model will test whether Zuckerberg’s efforts to rebuild Meta’s AI team have helped the company close the gap with its rivals.
Company leaders said it could compete with leading models from OpenAI and Anthropic in areas such as coding and answering financial or legal questions. Meta introduced a new AI model on Monday, describing it as a major improvement over its earlier systems.
